News: Iowa / Illinois  - States ask for look at possible gas price gouging

www.qctimes.com Last Updated: 2:27 am, Saturday, March 8th, 2003 By By Times Staff and wire services . The attorneys general of Wisconsin, Iowa and Illinois on Friday all but accused gasoline wholesalers or retailers of possible price gouging “taking advantage of the situation in Iraq by unjustifiably raising prices.” . “Suppliers and retailers should know that we are watching when it comes to protecting consumers at the pump,” Illinois Attorney General Lisa Madigan said. “Many factors affect the very volatile prices of gasoline, however, Illinois will act aggressively should companies cross the line that separates market forces from outrageous profits.

In a letter sent Friday to Federal Trade Commission Chairman Timothy Muris, Madigan, Iowa Attorney General Tom Miller and Wisconsin Attorney General Peg Lautenschlager said the American Automobile Association has said that companies are coming dangerously close to price gouging and has urged those companies to exercise restraint in the coming months. . They urged Muris to examine those markets and asked the agency to help determine whether there are any “price patterns not readily explainable by current market conditions or if the current market conditions are potentially being used as a ‘cover’ for collusive pricing.” . “We also will be vigilant for any signs of illegal collusion among retailers in our own states,” their letter states to Muris. “We have taken legal action in the past and certainly will do so again if there is any sign of such anti-competitive practices.” . In the Iowa Quad-Cities, a gallon of regular unleaded gasoline was selling Friday for an average price of $1.65, according to a report issued by AAA and the Oil Price Information Service, or OPIS. Mid-grade was selling for $1.74 and premium was going for $1.82. . But many factors figure into the much higher prices today. . A year ago — before the national strike in Venezuela cut that OPEC country’s oil production to a trickle; before war fears with Iraq; low U.S. stocks of crude oil and gasoline, and before a spike in natural gas prices that refineries use to run their operations. . The U.S. Department of Energy, or DOE, has said that despite rising prices, demand for gasoline continues to rise. The annual increase currently is at a rate of 2 percent. . Half of the more than 17 million barrels of oil used by the U.S. daily goes to gasoline, while another 25 percent goes to make diesel and jet fuels to transport products and people, according to the DOE. . Many parts of the country already have been paying $2 or more at the pump for a gallon of gasoline. Prices increased nationally this week to an average of $1.68, 54 cents higher than a year ago. The $1.76 a gallon average nationally forecast for April would be a nickel more per gallon that the record high of $1.71 set in May 2001, according to the Energy Information Administration, or EIA. . Even so, the EIA said those prices are a bargain compared to prices in 1981 if inflation were factored in. Using today’s dollar, drivers were paying the equivalent of $2.90 a gallon in March 1981, EIA officials said. . In 2001, then-Illinois Attorney General Jim Ryan cited dozens of gasoline stations, including some in the Quad-City region, with price gouging on Sept. 11, 2001, after terrorists attacked the United States. . He said at the time that people were charged prices of $4 to $5 per gallon Sept. 11. He called the price increases “unconscionable.” . The city desk can be contacted at (563) 383-2245 or newsroom@qctimes.com.