Call to investigate Michigan gas prices

Pain at Michigan gas pumps gets political


While gas prices around much of the country have been under $4 a gallon, drivers in Michigan has seen their prices jump, and jump again. It's become a source of frustration in Metro-Detroit.

"I hate it. I don't understand why they've gone up, but I can't afford it," said Marcia Portis, a driver who was fueling up in Southfield.

She told Ruth to the Rescue she's surprised she's paying more than most drivers around the country.

"I just left from New York, and their gas is only $3.85. I've never been to New York where something is cheaper than in Michigan!"

What's Going On In Michigan?

The discrepancy in prices has some Michigan House Democrats pushing Attorney General Bill Schuette to look for evidence of price gouging.

"Michigan drivers deserve to know why they're paying more for a gallon of gasoline her than any other place in the continental U.S.," said State House Democrat Leader Tim Griemel (D-Auburn Hills).

He's calling on the Attorney General to open an investigation into recent high gas prices and prosecute any producer, wholesaler, or retailer suspected of price fixing.

Station Owner's Response

Local 4 Consumer Expert Ruth Spencer spoke with a station owner in Southfield. George Denha owns the BP station at Northwestern and Franklin. He told Ruth he's also mystified by the big price fluctuations, and he's not making extra money off the price increase. He says stations like his make most of their money inside their mini-marts and not at the gas pump. Denha says when prices jumped recently, his business dropped by about 20 percent.

"We don't make much money... because these prices are hurting our business a lot," he told Local 4 Consumer Expert Ruth Spencer.

And, as for the investigation into price gouging? He said, "Let them investigate. I don't have nothing to hide."

Refinery Trouble

As the gas prices have climbed, many analysts have pointed to trouble at Midwestern refineries as part of the reason our prices our higher. The Michigan Democrats pushing for an investigation say they haven't heard enough details on those troubles, and they want to make sure big oil companies are being honest with Michigan consumers.

A spokesman for BP says its refinery in Whiting, Indiana has been undergoing improvements since November and a new processing unit should be brought into service later this month, as scheduled.

He also sent this statement, "Although BP does not own or operate sites in Michigan, we always cooperate with government inquiries into fuel prices. Gasoline prices have been investigated for many years now and these investigations invariably determine that prices are determined by the supply and demand factors of a free market economy at work."

Meantime, ExxonMobil told Ruth to the Rescue that its refinery in Joliet, Illinois has returned to normal operations. The company says the refinery had been undergoing planned maintenance that began on April 15th.

AAA Michigan says as the refineries come back on line we should start to see some price relief at the pump. However, analysts say the prices often drop much more slowly than they go up.

You Can Get Involved

State lawmakers, who are not convinced the whole story of the gas price increase is being told, continue to push for an investigation. They are urging you to join the effort. They say voters can sign a petition at LowerMIGasPrices.com.

"Everyone who feels pain at the pump should tell the attorney general that he must take action," said Democrat Brandon Dillon of Grand Rapids.
"People are busting their budgets just to drive to work, go to the grocery store, and get their kids to the doctor. We need relief now."

Driver that spoke with Ruth to the Rescue say they're ready to join the fight.

"Oh yeah, absolutely! And, I would encourage others to do it. I mean who wants to pay five dollars a gallon. It's going to get there, if it's not there yet," said driver Joseph Abo.

Attorney General Response

For now, the response from Attorney General Bill Schuette seems to be that his office is already keeping an eye on gas prices, and will take action if there is any evidence of price gouging. Below is the statement his office released, and it included other links where consumer can report any suspicious pricing.


As Michigan drivers deal with a spike in gas prices, Michigan Attorney General Bill Schuette today warned retailers against any attempt to take advantage of consumers by price gouging or price fixing.

"Michigan consumers are struggling with rising costs just as summer vacations are getting underway, making it hard on family budgets," said Schuette. "We will not tolerate unscrupulous behavior that violates Michigan law when it comes to gouging and price fixing. Gas retailers are warned: we are watching and will not hesitate to take action if you hurt consumers and break Michigan law."

Every day, year-around, the Michigan Attorney General's Office's professional legal team monitors the balance of wholesale and retail prices and profit margins in regions around Michigan.

Additionally, the office takes in complaints about individual stations directly into its Consumer Protection Division. The office investigates any time there is evidence that state law has been violated for gouging or price fixing.

Under the Michigan Consumer Protection Act, a retailer may not charge a price that is "grossly in excess of the price at which similar property or services are sold." Anti-trust laws also prohibit gas stations from entering into agreements to arbitrarily fix prices in unison.

For example, a little over a year ago, Schuette secured convictions for gasoline price-fixing by five Michigan station owners. The Department has also entered into "compliance-agreements" with stations requiring them to submit to monitoring after they spiked prices well above the state-wide norm on a particular day or after a weather event.

Schuette is committed to continuing to fight against higher gasoline prices in court when the price increases violate the law. If consumers become aware of direct evidence of a conspiracy between companies, or have verifiable evidence of a retailer charging a price "grossly in excess of the price at which similar property or services are sold," they are encouraged to contact the Attorney General's Consumer Protection Division at 1-877-765-8388 or file an online complaint at www.michigan.gov/ag.

For more information on gas prices in Michigan see Attorney General Schuette's Consumer Alert: Increased Gas Prices? Again?

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