FTC investigates gas price profiteering
...And if oil companies have constrained refinery capacity to manipulate fuel prices, an agency official.
WASHINGTON – The U.S. Federal Trade Commission is investigating whether gasoline price profiteering has occurred and if oil companies have constrained refinery capacity to manipulate fuel prices, an agency official.
«A determination that unlawful conduct has occurred will result in aggressive law enforcement activity by the FTC,» John Seesel, an FTC associate general counsel, told a Senate Commerce Committee hearing.
The FTC is responding to language in recently passed energy legislation that requires the agency to probe whether gasoline prices have been manipulated by attempts to reduce refining capacity, Seesel said.
U.S. oil companies have adamantly denied that they have acted to constrain gasoline or crude oil supplies.
The FTC is keeping an eye on gasoline prices, even though they have fallen from their record $3.07 per gallon national average price seen when Hurricane Katrina hit the Gulf Coast, Seesel said.
«The commission is very conscious of the swift and severe price spikes that occurred immediately before and after Katrina made landfall,» Seesel said.
Four major oil refineries remain shut and a large chunk of oil production in the Gulf of Mexico is still offline due to damage from Hurricane Katrina which slammed into Louisiana and Mississippi three weeks ago.
And now with the approach of Hurricane Rita, which has strengthened into a Category 4 storm, oil and gas companies have evacuated thousands of their workers from oil rigs and production platforms in the Gulf. Some refineries are starting to shut down, and Houston’s mayor called for an evacuation of low-lying, flood-prone areas of his city.
Separately, the Government Accountability Office said recent retail gasoline prices have risen faster than crude oil prices.
This goes against the historical trend when major crude oil price swings are generally mirrored by gasoline prices, said Jim Wells, GAO director of natural resources and environment.