Senate probe uncovers fuel spiking; diesel steady

| Tuesday, April 30, 2002

According to a story in the New York Times, a Senate subcommittee investigation found that some oil companies reduce supplies when markets are tight to force up prices and profits.

The Senate Permanent Investigations Subcommittee reportedly found that manipulation of fuel supplies aggravated tight fuel markets, spiking fuel prices, especially in the Midwest.

Sen. Carl Levin (D-MI), subcommittee chairman, said the report found that "in a number of instances, refiners have sought to increase prices by reducing supplies." In addition, he said the investigation "documents the actions by major oil companies to keep supplies tight and inventories low in order to increase prices and maximize profits."

An industry spokesman said the Senate panel's report was still being reviewed. A hearing on the report is planned Tuesday, including testimony from oil industry representatives.

As the investigation was made public Monday, the weekly retail on-highway diesel prices released by the Energy Department show the national average cost of diesel remained relatively unchanged from last week at $1.30 per gallon.

The highest prices nationally continue to be found in California. Diesel there is $1.426 per gallon on average. The lowest average prices are in the Lower Atlantic region. Fuel there is $1.263 per gallon. The remaining regions' price per gallon is as follows: East Coast, $1.307; New England, $1.391; Central Atlantic, $1.39; Midwest, $1.281; Gulf Coast, $1.271; Rocky Mountain, $1.356; and West Coast, $1.39, respectively.

Comments