California’s petroleum watchdog issued a market update on Friday, warning that while the state’s overall gas price increases are in line with the rest of the nation amid the ongoing Iran conflict, branded gasoline prices are being inflated, adding to the financial burden on consumers. The Division of Petroleum Market Oversight (DPMO) sent a letter to Governor Gavin Newsom and legislative leaders detailing the conflict’s impact and identifying two structural issues affecting both gasoline and diesel markets.
Since the Iran conflict began, retail gas prices have surged nationwide. In California, the average increase has mirrored the national trend, but the DPMO highlighted a growing disparity between branded and unbranded gasoline prices.
According to DPMO Director Tai Milder, the conflict has already cost California households over $200 in extra gasoline costs, while families in some parts of the country have paid as much as $350 more. “While our price increases are consistent with the rest of the country, we are seeing inflated prices for branded gasoline that are adding to the pain at the pump,” Milder said.
“Gasoline is not a luxury good. These branded prices are unacceptable for Californians who need to get to work and support their families.”
The DPMO’s 2024 Annual Report noted that branded suppliers raised prices in vertically integrated sales channels following the 2015 Torrance Refinery fire. The agency, along with the California Energy Commission (CEC) and the California Department of Tax and Fee Administration (CDTFA), is investigating the role of branded suppliers and retailers in the high street prices.
This includes an investigation of high-priced stations announced in an enforcement bulletin and consumer advisory on March 19.
As prices climb, the DPMO encourages Californians to shop around and compare prices between name-brand and unbranded (or generic) gasoline. While retailers typically charge more for branded fuel, all gasoline sold in California must meet the state’s high emissions and engine performance standards.
The letter also flagged structural issues in how diesel prices are assessed. Despite California being a global leader in renewable diesel and biodiesel production, these issues—including problems previously flagged with the Oil Price Information Service (OPIS), the dominant private price reporting agency—have prevented consumers from realizing many benefits.
The DPMO continues to monitor the market daily to protect consumers from price gouging and market manipulation.