US Senator seeks FTC probe of alleged gasoline price manipulation
US Sen. Claire McCaskill (D-Mo.) asked Federal Trade Commission Chairman Jon Leibowitz to investigate reports that refiners are cutting back on gasoline stockpiles to keep gasoline prices high.
OGJ Washington Editor
WASHINGTON, DC, May 18 -- US Sen. Claire McCaskill (D-Mo.) asked Federal Trade Commission Chairman Jon Leibowitz to investigate reports that refiners are cutting back on gasoline stockpiles to keep gasoline prices high. She specifically cited a Kansas City Star article that said wholesale gasoline margins were climbing to levels not seen since Hurricane Katrina in 2005 because of Mississippi River flooding.
“At a time when major refiners and oil companies are making record profits and American families continue to struggle with gasoline at record prices, the idea that refiners may be manipulating the market to keep prices artificially high is offensive,” McCaskill said in a May 17 letter, signed also by Democrats Charles E. Schumer (NY), Richard J. Durbin (Ill.), and Patty Murray (Wash.). “It is incumbent upon the commission to ensure that the American people are protected from this type of manipulation.”
Officials at the National Petrochemical & Refiners Association and the American Petroleum Institute immediately disputed the allegations.
“This is political theater. We’ve seen the show before, and we know what the ending will be,” NPRA Pres. Charles T. Drevna said. “Dozens of investigations of gasoline price fixing over the years have generated plenty of headlines and political hyperbole, but have failed again and again to find any evidence of wrongdoing. The only thing they have accomplished is to waste taxpayer dollars.”
Refiners have been producing record amounts of gasoline, but world and US petroleum product demand have been increasing, according to API Chief Economist John C. Felmy. “Critics wonder why gasoline prices are as high today as in 2008 when crude oil prices were significantly higher, but in 2008 the recession weakened demand and refiners lost money selling gasoline,” he said. “Press releases that call for yet more investigations of prices insult consumers. We need to be producing more oil, and producing more of it at home.”
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