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Printed from the Charlotte Observer - www.CharlotteObserver.com
Posted: Sunday, Sep. 14, 2008

Subpoenas coming on potential price gouging

By April Bethea
Published in: News
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    As gasoline prices in Charlotte rose to near-record levels this weekend, the N.C. Attorney General's office said it plans to issue subpoenas starting today as it investigates potential price gouging.

    As the cleanup from Hurricane Ike, which had sparked demand as motorists feared gas shortages and big price increases, continued on the Gulf Coast, N.C. officials said more details on the subpoenas could be released today.

    The move comes days after Attorney General Roy Cooper urged Gov. Mike Easley to trigger the state's price gouging law. Easley did so on Friday after declaring a state of “abnormal market disruption.”

    “Any station or any wholesaler that's trying to take advantage of this situation and is gouging consumers will face the music from our office,” Cooper told WRAL-TV of Raleigh this weekend.

    In the Charlotte region, prices rose to near-record levels over the weekend. A gallon of regular gas averaged $4.04 when stations closed on Saturday, more than a dime higher than a day earlier, according to AAA. The price was just shy of the record $4.06 per gallon set in mid-July. Nationally, regular gas averaged $3.79 Saturday.

    Some industry experts said it could still be at least a week or two, if not longer, before consumers see a significant decline in gas prices.

    Ike caused less destruction than feared. It left refineries damaged and destroyed at least 10 offshore petroleum platforms in the Gulf of Mexico. That's significantly less than the damage caused three years ago by Hurricanes Katrina and Rita.

    Lars Herbst, regional director for the U.S. Minerals Management Service stressed the fly-over observations were just preliminary. But he said the damage appeared far worse than that from Hurricane Gustav two weeks ago.

    In the days before and after Ike made landfall on the Texas coast, gas prices rose quickly at stations across the country, especially in the Southeast, fueled both by a reduced supply and extra demand.

    James Williams, an energy economist with the Arkansas-based WTRG Economics, said he thinks prices have risen “fairly close to the top” but said it could be at least three weeks before costs go back to where they were before Ike and Gustav. The decline in prices “will be gradual,” he said. “It won't happen overnight.”

    Williams said decreased consumer demand could spur lower prices. So would, he said, getting the pipelines that service the Carolinas back to full strength.

    Bloomberg News reported Sunday that Colonial Pipelines, which provides fuel to Charlotte and is the main supply for the state of South Carolina, has restored operations to its gasoline and distillate pipelines. Plantation Pipeline, another fuel source for Charlotte, was operating at reduced levels. The Associated Press contributed to this story.

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