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Whatever The Cause, Drivers Feel Gouged

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The Tampa Tribune

Published: September 20, 2008

As Hurricane Ike lumbered across the Gulf of Mexico two weeks ago, many of the people who live along the Texas coast packed up and headed inland, anticipating the worst.

In similar spirit, oil companies shut down their Gulf rigs and refineries and anxiously waited to see what would happen. After all, some 30 percent of domestic oil production and 27 percent of refining capacity comes from the region.

Fortunately, the storm that wrought destruction on Galveston, Houston and much of east Texas failed to seriously disrupt the nation's petroleum supply.

So why, then, has the price of gas jumped precipitously at stations from Georgia to South Florida?

The per-barrel price of oil dipped below $100 for the first time in six months, yet the per-gallon price of regular gas in Hillsborough is again approaching $4. Last weekend drivers paid as much as $4.77 a gallon for premium - the only gas apparently available - in south Georgia. In Tallahassee, Orlando and Miami, gas prices topped $5 at some stations.

All of this left drivers steaming and asking the same questions: Are we consumers being gouged? If not, why is the price so high?

Most people understand there could be a shortfall when refineries go offline, but it's hard to understand a $1-per-gallon jump in the days before a storm.

One explanation - the one given by gasoline companies - is that driver panic set in last weekend. Certainly drivers did not want to be stuck with empty tanks and so filled up before Ike passed by. Demand outpaced supply. Some stations went dry.

But were all those stations that sold only the most expensive blend really out of the cheaper stuff?

That's why investigations by the Florida Attorney General's Office and the Department of Agriculture and Consumer Services are welcome. The departments are checking into thousands of complaints of price gouging. Attorney General Bill McCollum's office received more than 7,000 complaints as of Thursday, and more than 2,600 had been referred to the Economic Crimes division for review.

McCollum and Consumer Services Commissioner Charles Bronson have subpoenaed the records of several major oil terminals in Florida to find out what those companies were paying for fuel supplies before the hurricanes and what those supplies were sold for.

If they find that gas stations charged grossly more than the average cost during the preceding 30 days, the stations should be fined to the maximum extent possible.

And to settle matters in consumers' minds, McCollum and Bronson should answer this question from The Palm Beach Post: When the price of oil was below $100 last December, a gallon of gasoline cost about $3. Why the difference now?

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