Three West Coast Democratic senators are calling for the Federal Trade Commission (FTC) to investigate unusually high petroleum prices in their states for possible market manipulation akin to the Enron scandal.
In a letter this week, Senate Commerce, Science and Transportation Committee Chairwoman Maria Cantwell (D-Wash.) and Sens. Dianne Feinstein (D-Calif.) and Ron Wyden (D-Ore.), who are both members of the panel, said the recent increases are disproportionate to crude oil price increases and cannot be attributed to market forces.
The letter requests a probe into any trading practices that may have artificially elevated prices in their respective states.
Cantwell, Feinstein and Wyden noted that on Tuesday, the committee heard testimony that West Coast petroleum contracts are based on largely unclear metrics, which they noted makes a market more vulnerable to manipulation, as in the case of Enron in the early 2000s.
“High and volatile fuel prices are hindering our economy and burdening families. Our constituents need to be confident that the markets are operating efficiently and fairly,” the letter states. “To achieve this, we hope the Commission will fully utilize all of its tools and legal authority to monitor, analyze, investigate, and prosecute any market manipulation that could be contributing to today’s record high West Coast petroleum prices.”
Cantwell also said during the Tuesday hearing that she is writing legislation to grant investigative authority to the FTC akin to the post-Enron scandal powers given to the Federal Energy Regulatory Commission.
Democrats have increasingly pressed the oil industry for answers on recent drops in oil prices and the lack of corresponding drops in consumer gas prices, compared to their rapid rise in response to increased oil prices.
Amid the price spikes, California’s in particular have been high, which experts blame on a number of factors, including its status as a “fuel island” that does not receive fuel from interstate pipelines, as well as an unexplained gasoline surcharge that has appeared since 2015.