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States Investigate Gasoline Price Gouging Claims

Gas prices soar as oil prices fall

By Joe Benton
ConsumerAffairs.com

September 16, 2008

Gas prices jumped 17 cents to $3.842 following Hurricane Ike and regular self-serve sells above $4 a gallon throughout much of the Southeast, prompting charges of price gouging to state government officials.

Some areas in the Gulf Coast and Southeast were hit with a more than a 20 cent a gallon overnight increase following Ike's landfall. The rapid-fire jump in prices come despite a significant drop in international oil prices which fell below $100 a barrel over the weekend and now hover near $95.

While the Gulf region produces nearly 25 percent of the nation's gasoline but the sharp weekend increase in retail gasoline prices generated thousands of consumer complaints throughout the country.

The Florida Attorney General responded with subpoenas to four companies demanding that they document the purchase price each paid for gasoline sold at their retail outlets in Florida. Subpoenas were issued to Flying J, Dodge's Gas Stores, Valero and Pilot Travel Centers.

The Florida Attorney General received more than 350 complaints about gas price gouging over a four-day period beginning Sept. 11. Price gouging is prohibited in Florida during a declared state of emergency.

"We will not tolerate gouging for greed," Florida Attorney General Bill McCollum said.

The Louisiana Attorney General's office is soliciting cell-phone photos of high gas prices in a effort to investigate price gouging.

In Mississippi, the Attorney General reported a "flurry of calls" regarding price gouging. "Many people are concerned that they are hearing that the price of crude oil is falling and yet their gas prices are rising at the pump," state Attorney General Jim Hood said.

North Carolina Governor Mike Easley declared a state of "abnormal market disruption" and directed the state Attorney General to enforce the state's price gouging statute.

Connecticut is investigating hundreds of complaints of suspected gasoline price gouging following Hurricane Ike, officials said.

Officials from the state's Department of Consumer Protection have received 170 complaints about questionable price spikes. Connecticut Attorney General Richard Blumenthal has received another 100 complaints.

Michigan reported gasoline prices jumped 43 cents a gallon over the past weekend to a statewide average of $4.17.

Of the cities it surveys, AAA Michigan said the cheapest price for self-serve regular fuel is in Traverse City, where it's $4.07 a gallon. The highest average can be found in the Ann Arbor area at $4.21.

Gas prices soared three years ago in the week following Hurricane Katrina, jumping 17 percent to $3.06 a gallon because of damage to refineries and pipelines.

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