California moved a step closer Thursday to enacting first-of-its-kind legislation that would penalize oil companies for “price gouging,” after the state Senate easily passed the measure in an Extraordinary Session convened to fast-track the bill.
The measure is expected to move to the State Assembly next week and receive Governor Gavin Newsom’s signature shortly after that.
The bill would enable the California Energy Commission to create a new watchdog agency to keep tabs on the oil industry and solicit data and records that companies have not provided previously.
It also would authorize the state to set a maximum gross gasoline refining margin, and then establish a penalty for any California-based refinery that exceeds the margin.
Companies most affected by the legislation likely would include refiners such as Marathon Petroleum (NYSE:MPC), Valero Energy (VLO), Phillips 66 (PSX) and PBF Energy (PBF), which has criticized Newsom for the “politicization” of high gas prices in California.
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