High gas prices break no antitrust laws, study finds
By Associated Press
Published June 16, 2005
TALLAHASSEE - An exhaustive study into gasoline prices in Florida produced no evidence of antitrust violations, Attorney General Charlie Crist said Wednesday, but he said the industry puts shareholders' profits ahead of the interest of customers at the pump.
Crist said attempts by major oil refiners to reduce extra inventory were partly behind the large jump in gas prices last year.
Because refiners don't keep more gas readily available, whenever demand spikes, supplies become too tight, pushing prices up, said Crist, who is a Republican candidate for governor.
He said he was concerned that mergers in the industry have cut the number of suppliers, another element pushing prices up.
On Wednesday, a gallon of regular gas in the Tampa Bay area averaged $2.092 a gallon, down from $2.149 a month ago, according to AAA. Mid range averaged $2.267, down from $2.328; and premium $2.308, down from $2.371.
In Florida, regular averaged $2.16 a gallon Wednesday, a bit higher than the $2.13 national average.
The industry trumpeted Crist's basic finding - that oil companies don't artificially manipulate prices at the pumps, and that prices are influenced by a number of complex world issues, from war to weather to economic growth in developing countries.
"We're delighted this is behind us," said David Mica, executive director of the Florida Petroleum Council. He said the industry supplied Crist with more than 60,000 pages of files and other evidence and Crist's lawyers found "no antitrust evidence at all."
Industry officials have long said that disruptions to supply can spike prices because of tight inventory, but Mica said the industry is proud of its ability to keep inventories at efficient levels and noted that producers have had to keep up with an enormous boost in global demand in recent years.
Mica said the biggest issue in keeping gas affordable is "getting more American energy to the public," saying the industry is hopeful that an energy bill now under consideration in Congress will "allow us greater access to more American oil and gas."
Crist also sent a letter Wednesday to the Federal Trade Commission expressing concerns about a proposed buyout of independent oil refiner Premcor Inc. by Valero Energy Corp., a merger that would create the largest refiner in North America. The FTC is conducting an antitrust review of the proposed merger.
Crist has been pushing the oil industry for more than two years to clearly explain why gas costs so much. In March 2004 he hauled executives from five big oil companies into a meeting to ask them why their product was so expensive and called their answers about weather and other supply disruptions "insulting."
The retail price of gasoline has been dropping nationally since April, but is higher than it was at this time last year.
