TAMPA, Fla. -- While Florida officials pursue gasoline price-gouging investigations, some energy experts say sharply higher prices at the pump as Hurricane Dennis approached do not appear out of line, reported The Tampa Tribune.
Attorney General Charlie Crist and Department of Agriculture & Consumer Services Commissioner Charles H. Bronson have asked oil companies and gas stations for financial records, claiming they raised prices as much as $1 a gallon in one case after Governor Jeb Bush declared a state of emergency July 7.
We believe that they were price-gouging, trying to take advantage of people as they were evacuating, Crist said. That's unconscionable.
But Mike Burdette, a senior analyst at the National Energy Information Center in Washington, D.C., said Florida gasoline prices before and during Dennis rose in line with the increasing price of gasoline for August's contract. Those oil and gas futures prices directly influence what consumers end up paying at the pump. When I look at Florida prices in general, they are not out of line with the rest of the country, he told the newspaper.
From June 29 through July 7, the future delivery price of gasoline on the New York Mercantile Exchange (NYMEX) increased 22 cents, from $1.59 cents a gallon to $1.81 cents a gallon, he said. That jump was prompted by the fear that an already tight supply of gasoline would get even tighter if Dennis forced the shutdown of coastal refineries and oil rigs in the Gulf of Mexico, delayed shipping or knocked out pipelines, Burdette said.
American oil refineries already cannot produce enough gasoline to meet demand, he added. And the closest refinery to Florida, one in Pascagoula, Miss., shut down in early July and did not restart until this week, Burdette said.
There are cases with hurricanes where there has been somebody taking advantage of people. It's certainly possible, Burdette said. But in the day- to-day gasoline business, we just don't see it.
Crist disagreed. He said nearly 1,600 complaints about sharply rising gasoline prices flooded a hot line into his office after the emergency declaration July 7. Under a state of emergency, businesses cannot raise prices on emergency necessitiesfood, water, hotels, gasoline, lumber and generatorsto more than the average price over the 30 previous days.
The concern that we had was that we saw prices go up over 30 cents a gallon within a 24-hour period of the governor declaring a state of emergency, Crist said.
As reported in CSP Daily News, Crist has asked for the financial records of Tate Oil Co., a distributor that delivers gasoline to Shell stations across Florida, and Motiva Enterprises LLC, the Houston-based supplier where Tate Oil purchases some of its gasoline.
At the Department of Agriculture, Bronson wants the financial records of 44 gasoline stations across Florida, including four in Hillsborough County, three in Pinellas County, two in Pasco and Polk counties and one in Hernando County.
The statewide average for a gallon of self-serve, regular unleaded gasoline was $2.23 on July 1, Burdette said. It climbed to $2.24 a gallon on July 7, and then jumped 4 cents a gallon the next day and about three cents more July 9, he said. It has hovered around $2.31 a gallon ever since, Burdette said.
Jim Smith, president and CEO of the Florida Petroleum Marketers & Convenience Store Association, defended price increases at retail gasoline stations across Florida, said the report. He told the paper that would not defend the major oil companies, but that they live and die based on market prices. If the commodities market determines the price will go through the roof because of the storm in the Gulf of Mexico...and they decide to raise prices 10 cents, that's what's going to happen, Smith said.
Gregg Laskoski, managing director for public and government relations at AAA South in Tampa, told the Tribune that figuring out who is responsible for the price increases will be difficult. He said AAA received anecdotal reports about price gouging. We can't confirm that that actually occurred.
Meanwhile, according to a report in The News Herald, Carla Gaskin, a spokesperson for the Florida Department of Environmental Protection (DEP), said Tuesday supplies were still low in areas affected by Dennis, but 1.8 million gallons of gasoline had been shipped into the Florida Panhandle in the previous 24 hours. She said emergency first responders, including FEMA officials, were given priority for fuel immediately after Dennis' arrival. After responders, retail outlets along the Interstate 10 corridor were next in line, followed by stations with generator-powered pumps in affected areas.
Lack of Florida fuel pipelines, ship delays precipitated by the hurricane and mandatory evacuation orders are some of the reasons behind the gas shortage, Smith told the paper. Also, fuel terminals needed to leave certain amounts of fuel in their storage tanks to maintain structural stability in the face of heavy rains and winds, he said.
Smith said it would probably be a few days before the area's fuel supply was close to normal. He said the fuel industry has committed four times the normal amount of transport trucks to the Panhandle to address the shortage issue, and emphasized his association had a vested interest in getting things back to normal.
The DEP is stressing conservation, Gaskin told the paper, and has a 30-day plan of its own aimed at alleviating shortages.
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