Reuters: Regulatory News: US senator seeks FTC probe of West Coast gas spike

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US senator seeks FTC probe of West Coast gas spike Jun 8th 2012, 00:05 June 7 | Thu Jun 7, 2012 8:05pm EDT June 7 (Reuters) - A U.S. senator for Washington state wants the Federal Trade Commission to investigate possible manipulation of the market for West Coast gasoline, which has been trading at a premium to the rest of the country for weeks. Senator Maria Cantwell wrote in a letter to the FTC on Thursday that over the last month, the average price per gallon of gasoline in western Washington rose about 20 to 25 cents, while the national average price declined by about 17 cents. She cited a report by McCullough Research, known for uncovering Enron's manipulation of the West Coast electricity markets, that questioned whether low gasoline inventories were really just an inevitable result of a recent refinery fire and unfortunately timed refinery maintenance shutdowns. "The report also suggests that the current divergence from typical West Coast pricing trends may have generated significant windfall profits for West Coast suppliers," Cantwell wrote. She urged the FTC to use its "Prohibition on Market Manipulation Rule" - authorized by a law Cantwell authored in 2007 - to figure out what is behind the prices at the pump. She said average Washington gasoline prices are only 8 cents lower than the previous record high of $4.35 set on July 6, 2008, when oil was trading at almost $150 per barrel, whereas today it is about $86 per barrel. She wanted the FTC to look into whether the high prices were the result of "deliberative efforts by West Coast refiners to keep gasoline inventories artificially low," even after the BP Cherry Point refinery fire in February. "The reasons why six other West Coast refineries simultaneously reduced operations are not well documented," Cantwell wrote. Link this Share this Digg this Email Reprints

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