Oil Companies Created 'Shortage' That Is Driving Record Pump Prices, Says Group

Last Year's Record Is Shattered at $3.40 for Regular in CA; New U.S. Mark

Is Cents Away

    SANTA MONICA, Calif., April 30 /PRNewswire-USNewswire/ -- Even as crude
 oil prices fell slightly today, gasoline prices continued a rocket
 trajectory upward due to "supply shortages" resulting from a combination of
 ineptness and greed on the part of oil companies, said the Foundation for
 Taxpayer and Consumer Rights.
     Analysts blamed new refinery outages in Texas and Oklahoma, while a
 spokesman for the American Petroleum Institute told the Kansas City Star
 that the problem was partly due to falling imports of gasoline. (see the
 story at http://www.oilwatchdog.org/articles/?storyId=4488). Tips from
 gasoline dealers in Southern California showed price increases of nearly a
 dime at wholesale last week, before the new refinery problems. (See report
 at http://www.oilwatchdog.org/articles/?storyId=4479).
     "Oil companies that have refused to increase refinery capacity enough
 to meet population took refineries out of service for longer than usual
 maintenance as well as fires, leaks and shortages of repair supplies, but
 refused to import gasoline to make up the difference," said Judy Dugan,
 research director of FTCR and OilWatchdog.org. "Then they have the gall to
 behave as though gasoline prices are an act of fate, not the shortage that
 they created."
     The shortage of supply allowed oil companies including Exxon and
 Chevron to continue a record streak of profits, posting new first-quarter
 highs largely on the basis of refinery profits that shot to unheard-of
 levels in the U.S., especially in the West. (See more information on Exxon
 and Chevron profits at http://www.oilwatchdog.org/articles/?storyId=4480
 for Chevron and http://www.oilwatchdog.org/articles/?storyId=4474 for
 Exxon).
     Prices in California hit $3.397 for regular in California today,
 according to AAA, breaking last year's May record of $3.38. The AAA
 national daily average of $2.953 is only eight cents shy of last year's
 high, $3.03, which wasn't reached until August. A federal weekly price
 report due out later today will show the same trajectory, but because it is
 a weekly average it will not fully reflect price spikes over the past week.
     "Crude oil is backing up at U.S. refineries, waiting to be made into
 gasoline," said Dugan. "It is stark evidence that government and regulators
 must step in to oversee and regulate both refinery capacity and supplies of
 gasoline. Otherwise this cycle of ever-higher pump prices and ever-higher
 oil company profits will continue while both individual motorists and the
 national economy keep paying the price."
     FTCR also favors government action to speed development of biofuels and
 other reductions in use of petroleum fuels, including vehicle efficiency
 and broader conservation.
     The Foundation for Taxpayer and Consumer Rights is a leading nonprofit
 and nonpartisan consumer watchdog group. For more information visit us on
 the web at: http://www.ConsumerWatchdog.org and http://www.OilWatchdog.org.
 
 

SOURCE Foundation for Taxpayer and Consumer Rights