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One candidate wants to suspend a host of state environmental policies that boost the price of gas. Another wants to suspend the 61 cent-a-gallon state gas tax.
Amid a spike in gas prices fueled by President Donald Trump’s war in Iran, at least two Democratic contenders for California governor are capitalizing on the moment to push for policies they say would give drivers a break.
Recent proposals from former Los Angeles Mayor Antonio Villaraigosa and San Jose Mayor Matt Mahan reflect how Democrats are trying to use rising gas prices, a potent election-year issue, to distinguish themselves as prioritizing the cost of living.
Their Republican opponents have been saying the same for months.
Villaraigosa is calling for a moratorium on a variety of state greenhouse-gas reduction rules that he called “failed policies.” They include carbon emissions limits at refineries, standards to reduce carbon in fuels and other rules he blames for forcing refineries to close. Such policies collectively add about 50 cents to the price of each gallon of gas, state estimates show.
Villaraigosa has received several campaign donations from the fossil fuel industry, including from Chevron, Marathon, the state’s largest oil and gas producer California Resources Corporation, and executives of two Kern County drilling companies.
Mahan supports temporarily suspending the state gas tax, but in an interview said he wouldn’t rule out also curbing some of the state’s refinery regulations.
Both candidates are lower-polling moderates, and their proposals are similar to ideas the two top-polling Republican candidates have been pushing.
Republican Steve Hilton has promised to lower the price of gas to $3 a gallon statewide by cutting the gas tax in half and eliminating policies that reduce emissions. Chad Bianco would do away with the gas tax altogether. Both Republicans would expand in-state oil drilling and keep refineries open, a goal Villaraigosa and Mahan also share.
Top-polling Democratic candidates Katie Porter, Tom Steyer and Eric Swalwell have not weighed in on what they would do to mitigate gas prices. Steyer and Swalwell on Tuesday night both dismissed the proposals of Villaraigosa and Mahan as unserious. Steyer’s spokesperson Danni Wang said he would rather focus on making “sure oil companies aren’t reaping excess profits” while Swalwell’s spokesperson Micah Beasley said he would prioritize keeping refineries’ fuel inventories stable as the state transitions to clean energy. Porter’s campaign did not respond to inquiries.
Democratic strategist Andrew Acosta said the ideas from Villaraigosa and Mahan could help the moderate Democrats boost their campaigns’ affordability bona fides, but he questioned whether they will make a difference in a crowded race in which voters are not yet paying much attention.
The latest polling shows Mahan and Villaraigosa tied with just 3% of likely voters’ support, but a quarter of those surveyed remain undecided on a candidate. Both have been dwarfed in ad spending by self-funding billionaire candidate Steyer, and Acosta said the gas proposals won’t gain traction if the candidates don’t spend big to promote them on TV.
“It could be a ploy, or good politics. Will anyone hear it? I don’t know,” Acosta said of the gas proposals. “It’s a little harder to get anyone’s attention just on the race itself, let alone this issue.”
Why are California’s gas prices so high?
As candidates blame taxes and climate rules for high gas prices, experts point to a more complicated, less politically convenient reality: The recent spike is largely driven by a global oil shock tied to the war with Iran, not state policy.
Nevertheless the war increases a deeper vulnerability for California, where gas prices climbed above $5.50 a gallon Tuesday compared to nearly $3.80 nationally: As refinery capacity declines and reliance on imports grows, global disruptions can trigger higher prices in California than anywhere else.
“The current increase is almost entirely due to global oil markets,” said Paasha Mahdavi, a UC Santa Barbara political science professor and energy policy expert. “The problem, though … is that our starting point is so much higher than nationally.”
State analyses show California’s higher gas prices come not only from taxes and climate programs but also a large remaining “mystery surcharge,” an unexplained markup oil companies add to gasoline prices.
That unexplained premium averaged about 41 cents per gallon between 2015 and 2024, costing drivers an estimated $59 billion, according to the state’s petroleum market watchdog.
“Gas prices are much higher in California for reasons that have to do with the market for refined gasoline,” said Michael Wara, a Stanford legal scholar who focuses on climate. “It’s something that is in the control of the industry.”
The oil industry blames California policies.
Prices “are higher in California because of taxes and compliance costs, but also because state policies have driven refineries and crude production out, said Jim Stanley, a spokesman for the Western States Petroleum Association, in a written statement.
Stanley declined to comment on Villaraigosa’s proposal for a regulatory moratorium.
Villaraigosa’s call to “overhaul” the state’s air resources board and for “an immediate moratorium on costly regulations overburdening California refineries” is a familiar refrain.
The air board’s climate programs — including the low carbon fuel standard and the state’s cap-and-trade program, recently rebranded as cap-and-invest — have faced repeated political and industry pushback, especially as regulators consider updates that could affect refinery costs.
Those climate policies raise fuel costs but have also generated billions for clean energy and transportation programs.
California’s air board has faced mounting criticism over both programs — the fuel standard drew opposition from Republicans, the oil industry, and even environmental justice advocates when it was revised in 2024, and this year oil companies, some Democratic lawmakers and Villaraigosa have warned that tightening cap-and-trade rules could accelerate refinery closures.
A touchy political issue
An even easier target in campaign promises is the gas tax, which lawmakers voted to raise in 2017.
It has risen by 20 cents per gallon since then, to 61 cents, and generates nearly $8 billion a year — the vast majority of state funding for highway and road repairs.
It’s also been a touchy issue for Democrats, especially in swing districts.
Porter, running as a Democrat to flip a GOP-held Orange County congressional seat in 2018, backed a failed Republican-led ballot measure to repeal that gas tax increase and ran ads declaring that “I oppose higher gas taxes.”
The move cost her a labor endorsement — unions generally support the tax because the revenue pays for projects their members work on — but it helped her head off claims that she supported the hike as she ran as an economic progressive.
Two Democratic lawmakers have lost their seats to Republicans in recent years after criticism about the gas tax.
Now Mahan, a Democrat, is pitching a gas tax holiday. He suggested that it last for the “duration of the war,” with a ballpark goal of keeping average prices below $5 a gallon.
“I would leave it to the experts in Sacramento to set that limit, but I think something around $5 is reasonable,” he said.
Asked how he would pay for road and highway repairs in the meantime, Mahan said he would find other funding elsewhere in the state budget.
Ryan Cummings, chief of staff at the Stanford Institute of Economic Policy Research, said he’s skeptical a suspension would save drivers because it’s possible gas companies would pocket some of the savings.
But he also warned against any governor removing the tax without providing alternative funding for road maintenance; reinstating a tax in the future would be seen as raising the price of gas by 60 cents a gallon at once.
If history is any guide, voters would likely balk at that: In 2003, facing a recall, then-Gov. Gray Davis tried to reinstate a vehicle license fee that the state had lowered for years. Opponent Arnold Schwarzenegger leapt to attack him for tripling the “car tax,” a move that observers agree helped him oust Davis.
“Taking the gas tax off is an easy thing to do,” Cummings said. “Putting it back on is extraordinarily difficult — and essential.”
