California has the trendiest, and most foolish, energy policies in the U.S. The result is a return to the early ’70s, when drivers lined up around the block, hoping and praying the gasoline wouldn’t run out before they got to the pumps.

“California’s oil industry now sits at the precipice of complete collapse,” says Edward Ring, director of water and energy policy at the California Policy Center, “and if that happens, more imports will not prevent lines at the pumps.”

How could California, which has the sixth most proved crude reserves in the country, be looking over the edge of a gasoline crisis?

California is hurtling toward the gas panic of ’25 because it has been at war with fossil fuel for decades. In the case of motor fuel, “the state legislature has disincentivized the production, distribution, and refining of oil in California,” says Ring, while “cities and counties have followed suit.”

Two refineries are closing their facilities, the companies that own them having determined that it’s become too difficult to do business in California, which is hostile to energy companies that aren’t sucking up taxpayer-provided dollars to build politically preferred solar and wind projects.

“By this time next year,” says the Pacific Research Institute, “there might not be even a dozen refineries left in the state to produce the 38 million gallons of California’s boutique blend that’s consumed every day.” 

A quarter of a century ago, there were 23 refineries in California, 40 in 1983. The remaining sites are the only ones in the country that make California’s special formulation – which adds 10 to 15 cents to the cost of a gallon of gasoline – so importing fuel from other states is not a readily available option.

California also has the highest motor fuel tax in the country, an obscene 71 cents a gallon, a low-carbon fuel standard that adds to the cost of refining crude into fuel and restrictive permitting, all of which are taking the state down the rough road of “a potentially unmanageable decline,” says Ring. The state has sued energy providers “to make oil and gas ‘more expensive’ in an effort to disincentivize the use of these energy sources” while a few local governments have started a trend they no doubt hope will catch on: they have outlawed construction of new gas stations.

As of Sunday, California had the highest gasoline prices in the nation – $4.71 a gallon. As painful as that is, it might be considered a bargain by next summer, when gasoline could cost as much as $8 a gallon, says University of Southern California professor Michael Mische – and maybe even more, since Chevron’s El Segundo refinery was damaged in early October by a fire and won’t return to full capacity for some time.

So the pain will be doubled – time burned “a mouldering” in lines waiting to pay the Golden State premium just to get to work, the store and home again.

— Written by the I&I Editorial Board

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