Tuesday, May 23, 2006

No Collusion nor Price Gouging

A federal investigation into port-Katrina gas prices found neither collusion nor price-gouging.

Gas prices soared across the country after Hurricane Katrina in late summer, but federal investigators reported Monday they could find no evidence that oil companies manipulated prices or colluded to take advantage of the situation to increase profits.

The Federal Trade Commission also determined in a longer-range finding that during the past 20 years refiners didn't seek to manipulate prices by cutting the number of operating refineries or limiting increases in capacity.

The report, which supports the long-held position of the oil industry that higher gas prices are purely a function of supply and demand in an increasingly global market, will be small comfort to Americans still angry over gas prices of more than $3 per gallon. It isn't clear how the study will affect Congress, where a variety of proposals to begin investigations of alleged gas price gouging and to boost taxes on the oil industry's record profits are being considered.

In California, a spokesman for Attorney General Bill Lockyer said the commission's findings won't deter Lockyer's investigation into post-Katrina gas prices. Lockyer has subpoenaed the CEOs of the big oil companies that operate refineries in the state and will start taking depositions from them in early June, Lockyer spokesman Tom Dresslar said.