FTC upgrades monitoring of country’s gasoline prices

by The Associated Press

The Federal Trade Commission is broadening its monitoring of gasoline markets around the country to gather information on daily price changes in an attempt to focus quickly on any unusual price spikes, the agency said.

FTC Chairman Timothy Muris said the agency has begun using a statistical model that is expected to track price spikes as they happen to identify factors contributing to the price fluctuations.

Data on retail gasoline prices, using credit card purchases from thousands of service stations in 360 cities, will be plugged into the model as will daily information on wholesale prices from 20 major urban areas, the agency said.

Retail prices have increased substantially since the first of the year, although they have leveled off in recent weeks. The average price of regular gasoline in mid-May was 31 cents cheaper than at the same time a year ago, according to the Energy Information Administration.

John Felmy, American Petroleum Institute’s chief economist, attributed the price increases this year to higher crude oil prices and the many blends of gasoline required for clean air purposes.

The FTC in recent years has conducted several formal investigations into gasoline pricing practices in the California and Midwest markets and concluded each time that there was no collusion among suppliers or violation of antitrust laws.

A recent staff investigation by the Senate Governmental Affairs investigations subcommittee concluded that oil companies, while not colluding, tended to manipulate supplies to keep prices high in tight markets.

In part, they are able to do so because of the reduced number of competitors now in the industry, the report said.