GRACE LEONG - Daily Herald | Posted: Monday, September 25, 2006 11:00 pm
The state Department of Commerce is asking for financial data from local refiners and retailers in its investigation of whether gasoline prices in Utah are being manipulated by the oil and gas industry.
The requests were made Monday following a meeting Sept. 19 between state department officials and representatives from Utah's gas refiners and retailers to investigate what the state calls "remarkably high" gasoline prices in Utah in the face of declining prices elsewhere in the nation.
Since the government probe was launched two weeks ago, gasoline prices in Utah have dropped to $2.80 a gallon on Monday, from $2.92 two weeks ago. In the Provo-Orem area, gasoline prices dropped to $2.79 on Monday, from $2.90 two weeks ago.
But Utah's gasoline prices are still significantly higher compared with those nationally, which averaged $2.38 on Monday. Motorists in neighboring Intermountain West states such as Nevada are paying $2.80 for gasoline, while those in Colorado are paying $2.69 and those in California, $2.77 a gallon, according to AAA's daily fuel gauge report on Monday.
"As we investigate Utah's high gas prices, I would advise consumers to use their purchasing power to find stations offering discounted prices at the pump," said Francine Giani, the state commerce department's executive director. "If every Utahn makes an extra effort to find the best price, retailers will be forced to lower prices."
On Monday, the state department said it wants copies of financial statements, crude oil pricing and purchasing histories, along with local refiners' records of "rack" or wholesale industry pricing from the Utah Petroleum Association and the Utah Petroleum Marketers & Retailers Association.
Representatives from both associations could not be reached for comment Monday.
The state also wants the local retailers association to provide daily pump pricing and bill of lading information for 24 randomly chosen gas stations in Utah to verify several claims the gas retailers made at the Sept. 19 meeting.
These include claims that retail prices can't be reduced until existing higher-priced motor fuel purchased by the gas stations are sold and that "short supply to some retail motor fuel marketers has contributed to keeping retail pump prices at the levels experienced recently," Giani said in her letter to John Hill, executive director of the Utah Petroleum Marketers and Retailers, on Thursday.
Among reasons cited for Utah's high gas prices is exceptionally strong demand due to a strong local economy. While Utah gets its gasoline from five refineries in the north Salt Lake area, plus imports from Canada, Colorado and Montana, supply is barely keeping pace with demand, refiners say.
The state also wants the local refiners to provide information on the daily price per barrel they paid for crude oil and the percentage of profits from the sale of all grades of unleaded gasoline to retailers. The state also wants the refiners to identify each gasoline retailer in Utah they own or are affiliated with.
To find the lowest gas prices in Utah, please visit www.utah.gov/governor and click on "Find Cheap Gas Prices in Utah".
This story appeared in The Daily Herald on page A8.