High gas prices are the fault of greedy oil companies. Therefore a windfall tax is necessary. That’s according to the brilliance of California Governor Dictator Newsom.

While crude oil prices are down, oil companies have increased gas prices in California by a record 84 cents per gallon in just the last 10 days. At the end of August, crude oil prices were roughly $100 per barrel, and the average gas price in California was $5.06; now, even though the price of oil has decreased to $85 per barrel, the average gas price at the pump has surged to $6.29.

Meanwhile, oil companies have raked in unprecedented profits on the backs of hard-working Californians – nearly $100 billion in the last three months alone.

This windfall tax is a penalty tax pure and simple. It is a tax that will go after oil and gas company profits when they rise above a certain rate (such rate will likely be decided by the legislature I’m sure), and then be touted as a “windfall profits” when checks are distributed to Californians.

This tax idea also comes with a new one-time rebate just before the mid-terms.

Up to 23 million California residents are about to receive tax refunds of as much as $1,050, thanks to one-time stimulus payments the Golden State began deploying Friday.

The payments, which will total $9.5 billion, mark the largest program of its kind in the state’s history.

There’s a catch to this wonderful little refund everyone will be getting. For many, that refund will barely cover the increase in income taxes that will take effect in 2024. That’s correct. One the same day Newsom announces he’s going to penalize oil companies with a windfall tax, he signed legislation that will increase California’s marginal income tax rate to 14.4%. That’s a full one percent increase! Those who make between $60 and $300K will see their rate increase to 10.4%, which is nearly a two percent increase.

Meanwhile, Newsom is getting super serious about this windfall tax penalty on oil companies.

Here are the facts: Crude oil prices are DOWN. And yet…gas prices are up. That’s because greedy oil companies are ripping you off.

They are raking in record profits at your expense.

I’m calling for a new tax on these corrupt oil companies to put money back in your pocket.

— Gavin Newsom (@GavinNewsom) October 6, 2022

With OPEC’s latest move, crude prices will go up.

Again with the mantra that high gas prices are the fault of the oil companies. He’ll blame them and not Biden’s policies which include shutting down pipelines, ocean oil drilling, and canceling new leases. That said, the idea of the windfall tax on oil companies should and must fail for multiple reasons.

Phil Flynn, a FOX Business contributor and senior market analyst at the Price Futures Group, said such a windfall tax would “further discourage investment in an industry that is desperately in need of capital to stay in business in an increasingly hostile governmental environment.” he said.

In April 2021, Newsom signed an executive order aiming to halt oil extraction in California by 2045. More recently, in August, the California Air Resources Board moved to require all new vehicles in the state to operate on electricity by 2025, a policy the governor previously asked regulators to consider.

California Energy Commission chair David Hochschild sent a demand letter to the oil and gas companies. He wanted an explanation for the high gas prices and he wanted it ASAP. He received a response that was MUCH MORE than he bargained for.

NEW: VALERO responds to California’s demand for answers recent gas price spike.

“As demanded with one business day to respond…”

“California is the most challenging market to serve in the United States for several reasons.” pic.twitter.com/r2T2UQleme

— Ashley Zavala (@ZavalaA) October 8, 2022

What an epically brutal response! Here’s the key points in this letter.

For Valero, California is the most expensive operating environment in the country and a very hostile regulatory environment for refining. California policy makers have knowingly adopted policies with the expressed intent of eliminating the refinery sector. California requires refiners to payvery high carbon cap and trade fees and burdened gasoline with cost of the low carbon fuel standards. With the backdrop of these policies, not surprisingly, California has seen refineries completely close or shut down major units. When you shut down refinery operations, you limit the resilience of the supply chain.

From the perspective of a refiner and fuel supplier, California is the most challenging market to serve in the United States for several additional reasons. California regulators have mandated a unique blend of gasoline that is not readily available outside of the West Coast. California is largely isolated from fuel markets of the central and eastern United States. California has imposed some the most aggressive, and thus expensive and limiting, environmental regulatory requirements in the world. California polices have made it difficult to increase refining capacity and have prevented supply projects to lower operating costs of refineries.

So, Newsom wants to impose a tax on companies that are already having to bend over backwards to make California’s ‘special fuel.’ A special recipe that is unique to California alone due to their asinine green energy policies, and is obviously very expensive to make.

If Newsom wants to help his California constituents pocketbooks, maybe he should look into dumping some of the regulations he’s imposed on the oil and gas companies. It briefs well, but he won’t do it because reasons.

Feature Photo Credit: Original artwork by Victory Girls Darleen Click