Are motorists getting gouged on gas prices?

Posted on Monday, September 15, 2008 11:01 AM ET

By Jim Popkin, NBC News Senior Investigative Producer

There's evidence of possible price gouging at gas stations in Florida, and lawmakers across the South today are on the lookout for other examples of unwarranted price increases in the wake of Hurricane Ike. Some states are even asking consumers to use their cell phones to take pictures of gas-station price signs, to document alleged greed.

In Florida, Attorney General Bill McCollum today is serving subpoenas to four companies, seeking information about reported gas-price gouging. The state has received more than 350 complaints.  "We will not tolerate gouging for greed," McCollum said. Florida is serving the subpoenas to the corporate offices of Flying J, Dodge's Gas Stores, Valero and Pilot Travel Centers.

So far, a Florida official says the highest report of gouging was $5.50 for a gallon of regular unleaded. At another fuel station in Miami, the price Saturday was $4.87 for regular unleaded and $5.09 for premium, the Miami Herald reported. Most South Florida stations are selling gas for under $4 a gallon.

In Texas, Oklahoma, Louisiana, Arkansas, Mississippi and North Carolina, state lawmakers are all on the lookout for gouging.
 
--In Arkansas, state Attorney General Dustin McDaniel said his office has received numerous complaints about possible gouging. McDaniel urged state residents to send him photos--by email or cell phone--of gas-station signs showing exorbitant gasoline prices.

--Louisiana is soliciting cell-phone photos of high gas prices, too. As of Friday, the state had received more than 1,000 complaints of potential price gouging after Hurricanes Gustav Ike, a state official said.

--In Mississippi, the state reports a "flurry of calls" regarding increased gas prices. "Many people are concerned that they are hearing that the price of crude oil is falling and yet their gas prices are rising at the pump," state Attorney General Jim Hood said. But Hood cautioned that, under Mississippi law, merchants are allowed to increase their prices after an emergency if they have incurred additional costs in bringing that product to the public. "If a gas station owner was making 10 cents a gallon before the state of emergency was declared, he may continue to do so. If the cost of obtaining gas goes up by 50 cents, the price may be increased 50 cents, so long as the owner does not make more than 10 cents a gallon above his costs," Hood said.

--In Texas, Attorney General Greg Abbott recently charged an Edinburg, TX, motel operator with price gouging. The state claimed that the owner of a Comfort Inn doubled prices after Hurricane Dolly. The AG found that the motel charged $149.99 for rooms, instead of the usual $79.99.

--In Oklahoma, Attorney General Drew Edmondson warned businesses not to price gouge in the wake of Hurricane Ike. According to state law, prices cannot increase more than 10 percent above the price charged immediately prior to an emergency declaration (unless the increase does not include any rise in profit to the seller.) In May, Oklahoma announced a settlement with the LaQuinta hotel chain that required the company to provide refunds and free room vouchers for consumers who overpaid for rooms during the December ice storm.

--And in North Carolina, Gov. Mike Easley declared a state of "abnormal market disruption" on Friday, and directed the state Attorney General to enforce the price gouging statute. "As a result of Hurricanes Gustav and Ike, oil refineries in Texas and Louisiana have temporarily interrupted some gasoline supplies to the pipelines that serve North Carolina. Therefore, there may be temporary limitations on our gas supply. However, wholesale gas prices are up less than 20 cents a gallon over the last few days. Therefore, consumers should not see prices rise substantially more than this rise in the wholesale price," the governor said.

Comments

In the Winston Salem, NC area, prices went up to $5.25 in some stations and most others raised their prices also to take advantage of the situation.
Not only in the South but in the North East as well. I have seen gas station prices go up .25 cents in one day on a couple of occasions since the start of the reported last hurricane. Greedy, greedy money grubbing at it's worst...
Why do they only go after the small guy for gouging when the big oil companies have been gouging us for 8 years? Is this just the way it is or can the American people do anything about that since the persident or vice-president is not willing or are they so deep in bed with them?
Gas stations should be allowed to charge as high a price as they want even in times of natural disasters.  If prices were higher, there would be adequate local gas supplies.  Almost everyone I know filled up every car and gas can they own this weekend.  If prices were higher, people would only buy the gas they need instead of all they want thus keeping an adequate supply at local gas stations.
Most stations in Jacksonville are charging about 4.99 per gallon for regular gasoline. This is up from about 4.61 prior to Ike's strike on Texas.

The mayor of Jacksonville is deeply rooted in Gate gasoline stations. One would think he might take notice of the gouging.
Gasoline prices have not followed suit with the currect oil prices.  Oil has come down more than 33% since July.  Current gasoline prices should be less than $2.80 a gallon.  
Well DUHHHHH!!! its all about supply and demand and all about the mighty dollar and whether we like it or not this is very common practice among the travel industry it sucks yes but this is the way it goes.. if you dont like it.. MOVE!
Friday the BP station on thr corner of Woodlawn and Sout blvd was $3.69 in the morning, then $4.09 at lunch time and at 5:00PM it was at $4.29.  I would say that is price gouging.
sorry, but this is not news.  If someone at any level of government actually did something about it, that would be news! and if the Bushies did something to combat it, that would be world-class news.
Gas prices jumped from $3.49 to $3.73 and the price of oil dropped.  There is no impact if the Hurricanes that has reached the pumps.  Why then did the price jump? Greed. A few stations held prices.  But they were told that if they do not raise their prices, they will not get gas.  This sounds like price gouging to me....
Prices in rural parts of Charleston, including Holly Hill, Walterboro, Eutawville, Santee, etc. are experiencing prices in the upper $4.00 range, with one gas station that I saw on Saturday had prices at $4.69. This was over $1.00 hike in prices from Thursday. Prices are still at the $3.99 level in most places, but $4.39 and up seems to be the trend everywhere else that I look. Is this considered to be price gouging?
In Raleigh,Cary, wake forest area in NC Crown jerked there prices up to 4.72 causing other companies to do the same.  The only station I saw that did not do this was HESS and sheetz.  They sold the gas with a small rise of 15 cents until they ran out.
Its always interesting to see that the prices dont go down as quickly as they go up. Pilot truck stops all up I-75 in the south are 4.99 for regular. Lets see if they come back down to the 3.55 that they we at before the storm. Keep wishing
Yeah, have them check the Wesco Company in West Michigan. Generally 40 cents above the national average.
Big Oil is a Big Ripoff! I'm sure everyone already knew this, but if our lazy legislators would get off their hinies and push for laws, research, and development of clean, renewable resources such as oxygen, wind, or hydrogen, we wouldn't be having this problem that needs to be addressed immediately. I think everyone forgot about Global Warming and how it is going to flood the crap out of our states on the coasts and send us into impending doom. The greenhouse gases produced by the billions of cars everyday won't stop, because people are too reluctant to change what they are so used to, and they are too lazy to walk a couple of blocks and instead have to drive their 5 MPG Hummers.
So, if I own a hotel in Vegas, and a big convention is coming in, I can raise my prices to whatever level I want.  Unless a hurricane comes through.  Then I don't have to obey the rules of supply and demand?  Seems to me that as long as I am not discussing the issue with other gas station owners, and I raise my price due to demand, then I am just being capitalistic, and there isn't anything illegal about that, is there?
Yes, we are getting gouged and I think it is not only illegal, it is just plain wrong.  Almost everyone is struggling trying to pay over $3.50 and then the prices go up over a dollar a gallon in a matter of hours.  But I will bet that they certainly don't come down that fast.  Surely we have some protection against these ludicrous prices.  They know we can't do without gas because we all have to work and eat.  
Well don't just sit there and whine about it.  Call your state's attorney general office and complain. Give them the details and the locale of the station.
The only reason why Florida is acting on price gouging is because the citizens have voiced their complaint.  I highly suggest those of you in other states do the same.
YOu should check out the Truck stops across Mississippi. the one at Tillatoba Ms is $4.79 and the Pilot at Winona Ms is $4.79. Meanwhile every other station is a 50 mile radius is $3.82 and under.
In a free market American system, businesses can charge whatever the market will bear. As long as it canot be proven that competing businesses did not get together to jointly raise prices there is nothing that can or should be done. A station should temporarily raise his prices to 8.00 per gallon and report himself and then sue the procecuters for wrongful prosecution.
This whole problem was propegated by the Media.  A person is smart, People are dumb panicy animals and we all know it.  The prices here went from $3.57 to in some places up over $4.19, and one fools prices in High Point were starting at $5.00. It was still like that on Sunday.  This is a free market economy I understand, but really it is the media responsibility to stop the madness and to let people know that there is no gas shortage. The gas stations are going to miraculously run out of gas overnight unless we make a run on the place. Where was the media in the morning and through out the day to tell people that it was a sham. So much for truth in our reporting.  
Motorists are definitely getting gouged on gas prices. I saw on the news yesterday that as one guy waited in line for about 30 minutes for his gasoline, the price went up 40 cents in about 30 minutes, which was utterly ridiculous. I personally have spent about 60 cents more yesterday than I did this past Tuesday, which is less than a week a part. In other words in less than a 7 day radius, I spent 60 cents more than I did less than 7 days ago. If that is not gas gouging than there is no such thing as gas gouging. I also noted that oil prices have dropped 33% since July, however the price at the pump remains about the same or even higher at some stations. Why is this that the price per barrell is now under $98.00 per barrell, but the price at the pump REMAINS over $4.00. The people in the oil business are crooks and cannot be trusted. Somehow they get the idea that Americans are comfortable paying $4.00 a gallon, when the price should be around $2.80 a gallons, reflective or more indicative of the price per barrell of under $98.00. I am of the opinion that if the price per barrell came down to $10.00, which is what is was back in the '70s, somehow the oil companies would still charge consumers $7.00 to $10.00 per gallon, which would be highway robbery.
Florida is the worst when it comes to price gauging. Gas where I live has gone up more then 50cents in 2 days in some areas. Ocala Florida
It isn't just in the south where they are getting hit by high gas prices. We are just outside Chicago and all the gas stations here have raised there prices from 3.87 per gallon as high as 4.39. We went just over the border into WI this weekend and we bought gas for 3.69 and 3.79 per gallon. What's the deal? Can these stations just raise their prices whenever they feel like it? Whether it be the barrel rising or now there is a problem with the pipelines? I thought they had to wait until they were delivered a load before raising their price. There use to be a number you could call if you thought there was price gouging going on and there would by checks on the stations to make sure this wasn't happening. What happened? I guess law makers don't care about the small guys who have to drive to work.
If you will look at this site it will show the gas price all over the USA and you will see that NORTH CAROLINA is the hightest gas price in the USA  WHAT THE HECK ARE THE GOVERNOR HERE DOING ABOUT IT? NOTHING LETING THEM RUN THE SHOW. We need a change and I hope people wake up.  www.fueleconomy.gov/FEG/gasprices/states/index.shtml
IS ANY ONE ELSE JUST TIRED OF THIS GAME OIL COMPANIES ARE PLAYING?  CRUDE OIL DOWN ALMOST 50.00 A BARREL BUT GAS GOES UP .30 IN ERIE PA CAUSE OF A HURRICANE.
HELLO, MR OIL TYCOON YOU BREAK THE BACKBONE OF AMERICA MR GREEDY OIL TYCOON AND YOU WONT GET YOUR LOBSTER DINNERS AND ALL YOUR CROOKED PERKS,
HOPE YOU CHOKE ON THE CRAB YOU EAT WHILE IM WONDERING WHAT BILL TO PAY OR PUT GAS IN MY CAR!
BUT, YOU WILL ONE DAY PAY FOR YOUR GREEDY SINS!
WENDY DAY, ERIE PA
Price gouging is a part of daily life. Crisis or no crisis. In 1973 during the oil embargo gas was selling for five dollars or more at greedy gas stations. Five dollars then was worth a great deal more then now.
J Las Vegas, you have clearly missed the point, spot prices for light sweet have dropped and the dollar has not slide that much (vs. other currencies) to warrant SUCH large increases in fuel prices.  It is all about greed, and has nothing to do with typical practice in the travel industry. Are you saying your more than happy to to pay the higher price when three stations across the street probably are cheaper.  That does not bother you?
Decatur Alabama...you're a moron. There is plenty of gas to be had. Stations aren't running out of gas. People fill up because the prices change from day to day for no apparent reason. Oil has dropped in price per barrel but the cost of gas continues to climb...how do you explain that other than greed. Obviously, you must be a gas station owner.
Just outside of DC the prices went up about 25 cents on the heels of Ike.  Which frankly is absurd to me considering that only 1-2 day, disruption would cause that much of an increase.  And given damage appears to be small and the price of oil still declines.  We're still paying high prices on gas.
SUPPLY AND DEMAND The meaning has changed drastically over the years. Today the major suppliers control the supply so they can demand higher prices. The oil companies have not invested in a new refinery in more than 10 years even with profits drastically and capacity unable to keep up
I see this the same as looting. What do they do to looters?
#1 -- gas stations are told what to charge
#2 -- the wholesale gas prices jumped on Friday to around $4.85/gallon, even though oil was at the lowest point in month
#3 -- chain stations can afford to take a loss by charging less for gas than they pay; independent stations have to charge at least the wholesale price to avoid loosing money
#4 -- stations have to pay COD for their gas, so they have to adjust their prices to be able to afford their next load of fuel
#5 -- OPEC decided to decrease production by 30% because the price of barrels of oil had dropped so much

I'm not saying that there weren't stations out there gouging, but I don't think all of them were. I think we need to look at why the price of barrels of oil dropped so much, why they got so high, and why the wholesale price of gasoline was so high before we start accusing every station out there of price gouging.
decatur alabama, I am a gas station owner. Yes we
do run out of gas and sometimes it is very hard to get.  Yes obviously greed is a factor however
anyone is welcome to get in the staion business as this is a unregulated commidy I can sell my
gas for $100 a gallon if I want it is up to the comsumer to decide not to purchase it.
We live in Southern Illinois. On Saturday morning the price of gas was $3.54. By 1:30pm it was $4.49. My husband was so outraged that he called the telephone# they give you to report gas gouging. Evidently he wasn't the only one who called, by the afternoon on Sunday the prices went down to $4.09, which is still relativley high. I'm hoping it just go back down soon.
For those of you that thinks these price increases are normal or that the gouging is just the way it is and there is nothing that can be done about, you are part of the problem.  There is plenty of gas.  If not the price per barrel would not be down around $100 right now it would be back around $150 where it was a short while ago.  WE need to fix this problem because government can't or won't fix it.  Most politicians are so vested in the oil companies that they have no desire to push them to comply.  But if the entire country starts doing something about it they will begin to fall in line.  It's up to us to get the prices down.  Stop running all over the place for unnecessary items.  Make your trips more meaningful from a gas usage perspective.  Stretch the gas you have as much as possible and the reduced demand will force the oil companies and especially the greedy gas stations to lower their prices.  When their sales start going down, so will their prices.  No one in the government will force this to happen.  WE HAVE TO!!!
The oil companies keep saying the price at the pump is based on what the oil the gas in the ground was originally sold for. So it was supposedly based on the price of oil that was bought 3 to 6 months ago.  They still claim that today, that's their excuse for the price of gas not falling back now because the oil they bought 4 to 6 months ago is what regulates the prise of gas today. But after Katrina hit, the price of gas has fluctuated with every world crises. If something threatens the flow of oil the price jumps and the price of gas goes up instantly.

Also we keep getting told by the gas stations that they barly make any profit on the gas they sell. Well apparently that is also a lie as the gas that was in their tanks did not change price. They had already paid for it. So yes, while they might be allowed to adjust price according to supply and demand, those that take advantage and gouge the public should be fined by the state and remembered by the public and boycotted.
I think that the take home point in all of this is that we absolutely have to get off of petroleum as a liquid fuel source. If we were already using alternative energy such as electric or air driven cars (see MDI aircars) then we would not need anywhere near as much oil. The big oil companies are preventing alot of this technology from reaching the hands of consumers for obvious reasons (see current prices of gas). Please look at www.pickensplan.com if you want to do something to end our love affair with oil.
Here's an idea... stop driving for a while. Buy a bicycle, walk places, car pool. Increase the reserves through a republic-imposed boycott of the oil industry... and while we're at it, let's wear more fleece, knit some blankets and lower our thermostats to reduce the need for electricity and natural gas. Seems to me actually doing something constructive to save resources would be much better than complaining about what people are charging for us to use theirs. Oh, and when it comes to supposed price gouging being capitalistic... forget about it. Fair price for fair product... period.
We certainly need to find alternative forms of energy - it took billions of years for oil to form from the dinosaurs (yes, that's a piece of "Dino" in your tank) and the supply is, indeed, finite.  And to the best of my knowledge, none of us have billions of years to wait around for a refill.

Having said that, the price of gasoline has been manipulated for many years under the guise of "supply and demand".

We have been told that world demand is far outstripping supply - thus the reason for these price hikes.  The trouble is, since the mid 70's, (again, to my knowledge) no one has been able to show anywhere in the world (certainly not in the U.S.) where the gasoline supply has been interupted as a result of supply issues.  We do not always need proof in the short term, but in the long term, when the same argument is put forth time and time again, with no sign of it proving true, we and our legislators need to start questioning the premise a bit closer.

If this is not an example of the Emperor's New Clothes, then what is?
With reference to free markets dictating pricing in America, oil is now being traded as a commodity, in the exact same way wheat, pork bellies and frozen concentrated orange juice are traded.

The problem is, most of us could live the rest of their lives in a very comfortable state without ever eating another piece of bacon, having another piece of cake or drinking another glass of frozen orange juice.  The same, however, cannot be said for oil.  This is truly the one commodity which is vital to both our collective economy and, in some respects, our very existence.

Oil speculators who have absolutely nothing to do with the oil itself (other than to attempt to manipulate the price) have been given free run to buy contracts, hold them - thus forcing the price of oil higher - and then sell them at the opportune time to make a significant profit.  The average person on the street then has to live with the result of that speculation in the form of higher gasoline prices.

It is quite interesting (and coincidental?)that several months ago, as soon as Congress started asking questions and probing into oil speculation, prices took a nose dive from $140/bbl to, at this writing, $94 per bbl.  Da ya think they might just be connected?  Somehow, I do.
I live in a small town in North Carolina and I believe we are getting ripped off at the pump.  The day before Ike hit the Gulf, gas for regular unleaded was $3.69.  Then, the scare was on for not having enough and they jacked the prices to now $4.19 and counting.  That is absurd!  My husband is currently working up in Virginia and he said gas was still just $3.79.  Why is ours so much more??
In Valdese, NC, I saw the price go from $3.79 to $4.50 in just over an hour.  The lines for the gas were five and six cars deep.  Most people filled up their vehicles becasue we were told by the store operators no one know when the gasoline would be available again.  
Price gouging? Come on your local gas station owner would not do that to you especially up here in upper Michigan it's the big oil companies telling them they have to raise the price now even though the gas in their underground tanks had been already paid for. "Bull Crap!!" Now they use any excuse to raise the price, if a chickadee farts to close to a transfer station the price goes up immediately. If you want things to change in you’re area just boycott one or two of the price gouging stations. In our case up here it's the CITGO (Chavez) and BP owners setting the prices and the Governor will do nothing about it. If everyone sticks to this you will see some changes for the good.

Fight Back!!
More proof that the Oil Companies should be regulated like the power companies, since just a few huge companies have a virtual monopoly on the supply and purposely manipulate it (and us consumers)so they have yet ANOTHER excuse to raise prices. Locally, prices went up overnight to the $3.89 to 3.99 range, and I stopped at one station that had it at $5.24. Several stations here ran out of gas. Now, they have an excuse to raise it even further, since the panic they created sucked up all the readily available gas prematurely. Yes, a lot of people filled up that really didn't need to, but it's all a gamble-----run out holding out for cheaper gas or get it while you have a "bird in the hand" and don't know about the price (or availability) tomorrow. They've (BIG OIL) has been able to play both sides against the poor US MOTORIST for DECADES: Washington, when will you really HELP US?????
There were a few stations that didn't get crazy with their prices during IKE. Let's support them when the smoke settles. The greedy ones will get the message.
this isn't the oil companies doing this - it's the distributors of the oil, on the ground tell the service station owners the price they need to pay for gas when they drop it off. Tere in TN at the Sam's club the trucker bringing "IN" the gas said gas was $5.25 a gallon, now Sam's Club didn't pass that on to it's customers but that is what it paid to get the gas from the tanker. It only charged the Sam's club customers the 3.80 like it was before. (they they ate a 1.50 a gallon)  AND if you want to look at who is making money off our gas, look no further than our OWN GOVERNMENT. The Fed's make DOUBLE a gallon in taxes than what the oil companies make, and the oil companies have R&D etc to pay for. The STATE Taxes on our gas are worse. You are paying up to .40 CENTS PER GALLON in taxes. The oil company gets .07 cents per gallon. Tell the government to STOP SPENDING MONEY and maybe just maybe we can lower the taxes enough to actually afford our own gas.
I live in Augusta Georgia, and am a disabled Vet, I went on Fort Gordon Army Base today to find gas. Many stations were out of gas and I found that one of the two on base was out as well.  When I found gas it was $4.49 per gallon with a 10 gallon limit.  I guess the only way I can cope with it is to say "A hundred years from now, nobody will know the difference"  Sandy, Augusta, GA (USMC)
Im sorry this is a joke! UK motorists are paying over $9 a gallon for unleaded - I personally think you se fact US economy sucks !
Where's the federal government?  Why haven't they done anything?  Because they are in the pockets of big oil.  We need to vote those democrats out of Congress.  They made promises that things would change under their control but it's just more of the same.


Send a comment

PLEASE READ: All comments must be approved before appearing in the thread; time and space constraints prevent all comments from appearing. We will only approve comments that are directly related to the blog, use appropriate language and are not attacking the comments of others.

Message (please, no HTML tags. Web addresses will be hyperlinked):

Your name, city and state (John Doe, Seattle, Wash.): 

Your e-mail address (jdoe@msnbc.com):

Your website (it's okay if you don't have one):

Remember me? (We'll keep it private)

About the blog

Deep Background is NBC News’ investigative blog. It covers national security, terrorism, spies, Iraq, and politics, as well as government waste, fraud and abuse. It is edited by NBC News Senior Investigative Producer Jim Popkin.

Archives


Browse by topic:

Add this blog to your news reader