Agency to develop rules for investigating oil, gas markets
May 5, 2008
Under pressure from members of Congress upset about high gas prices, the Federal Trade Commission said recently it would begin developing rules allowing it to investigate alleged manipulation of the oil and gas markets, the Associated Press reported.
Congress passed an energy bill last year that gave the FTC additional authority to penalize companies that manipulate oil and gas prices by slapping them with fines as high as $1 million.
As gas prices have touched record highs of $3.60 a gallon in recent weeks, House Speaker Nancy Pelosi, D-Calif.; Sen. Maria Cantwell, D-Wash.; and other lawmakers urged the FTC to move faster on the rules.
The agency responded by taking the first step to develop the rules, which it hopes to finish by the end of the year.
While members of Congress are eager for the FTC to use its new authority, the agency has studied the oil and gas markets before and hasn''t found evidence of manipulation.
Last August, the FTC issued a report that found no evidence of manipulation after gas prices spiked to more than $3 per gallon during the summer of 2006. That study was requested by President Bush under the agency''s antitrust authority.
Oil companies, meanwhile, are reporting huge quarterly profits. Exxon Mobil said recently it earned $10.9 billion in the first quarter, a 17 percent increase over its profit in the same period last year and the second-highest quarterly profit by any public company.
Last week, ConocoPhillips reported a 16 percent rise in net income to $4.14 billion. Chevron Corp. is scheduled to report its results soon.