Maryland, D.C. AGs look into gas price spike
Some local gas stations raised prices overnight, in some cases by as much as 20 cents. Maryland’s AG is looking into the issue.
The regional average for a gallon of regular stands at $4.03. Some gas stations across Montgomery, Prince George's and Anne Arundel counties increased prices by 10 to 20 cents overnight. The same happened in Northern Virginia. AAA said local motorists are reporting jumps of 20 to 25 cents a gallon since Monday at some gas stations in Virginia and Maryland.
Maryland Attorney General Doug Gansler says he wants answers. “This is unprecedented. It hasn't happened during Katrina or any other time,” he said. “They cannot raise the price by that much and then rely on deceptive reasoning."
Several station owners told ABC7’s Brad Bell their contracts with distributors forbid speaking with the media, but privately said they were outraged because it's killing their business. One owner passed along a document he received Monday night ordering a 20 cent increase.
The document simply states, "Price chng +.2010," effective on Sunday at 7 p.m. No explanation was given by his distributor.
Another says he was told the price hike was a reaction to Midwest floods and potential disruption of refining operations and barge traffic on the Mississippi River.
The flooding threatens to limit barge movements and to disrupt refinery operations along the Mississippi waterways. It has caused a panic in the spot gasoline market, AAA Mid-Atlantic said in a statement. “As a result, gasoline prices have jumped 20 to 30 cents a gallon in many parts of the country, including the Washington metro area,” the organization said. It is tracking spikes in local gas prices this week.
Finding the cheaper stations has taken on new urgency for drivers. “I pulled into the Shell … and then I saw the sign for Liberty and the price and said ‘I'm going there,’” said Marie Burkholder.
Distributors “need to take a deep breath and avoid passing on price increases to motorists,” said John B. Townsend II, AAA Mid-Atlantic’s Manager of Public and Government Affairs.
The eleven flood-threatened refineries along the Mississippi River in the Baton Rouge/New Orleans region account for about 14 percent of the gasoline refined in the United States. Those refineries are continuing to operate normally, AAA said, and most of them do not anticipate any production disruption from the flooding, according to reports AAA received from the Oil Price Information Service.
Customers don't buy the gas distributors’ reasoning. “They are just trying to take advantage of the situation,” Turmaine Cooper said.
Even though Maryland has no anti-price gouging law, Gansler has sent a letter to one of Maryland's largest petroleum distributors demanding justification for the hike when the national gas-price trend is downward.
A spokesperson for the distributor, Empire Petroleum, said the responsibility rests on Wall Street speculators and oil companies.. “We get a price from our distributors and we pass it along to our customers,” said Travis Booth. "We have many distributors."
Some of the station managers who have yet to raise their prices say they don't think they will be able to hold out much longer. They say their prices will likely soar with the next shipment from their distributors.