(Click here for previous CSP Daily News coverage. Andclick here to view the President's remarks.)
A CSP Daily News poll on Monday said, "President Obama has called for an investigation of possible oil-price gouging. Do you think any will be found?" Of the 200 readers participating, nearly 59% said "no," 28% said "yes, some here and there" and nearly 14% said "yes, a lot."Even more emphatically, in the letter, Gilligan said that widespread gouging is not happening:
"For the most part, the major, integrated oil companies are becoming more removed from the retail gasoline business and are selling many of their locations to independent petroleum marketers. Of the more than 160,000 retail gasoline locations in the United States, more than 98% are now owned by independent businessmen and women. While those small businesses may sell a particular brand of gasoline, they do not share in any of the profits (or losses) generated by refiners.
"I cannot stress enough that gasoline retailers do not benefit from high crude oil or gasoline prices. Because we operate in such a competitive environment, the higher prices go, the further margins are squeezed. It is not uncommon in a period of rising prices for retailer losses to exceed 10 cents a gallon. In addition, gasoline retailers pay a ridiculous average of 2.5% of the cost per gallon to credit-card companies in various interchange fees.
"Regardless of the fact that it is not in the best interest of a gasoline retailer to gouge (both financially and as a responsible member of the community as a whole), there is no evidence that meaningful retail gasoline price gouging has ever taken place.... There will inevitably be some bad actors, and I will certainly not make excuses for those who prey on consumers; however, I believe that a 99.9% compliance rate for the industry as a whole shows that gouging is not occurring at the retail level.
"Lastly, we hope you will find an opportunity to praise the thousands of gas station owners who have priced responsibly and who have worked tirelessly to keep their customers supplied and costs as low as possible during volatile market conditions."
He also reiterated the association's earlier call for the President to release 30 million barrels of oil from the Strategic Petroleum Reserve (SPR).
Click hereto read the full text of Gilligan's letter.
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