Legislator seeks investigation into Alaska’s high gas prices

ANCHORAGE — A state lawmaker claims that Alaska’s only gasoline refiner has been manipulating gas prices, as the monthly average has recently begun to rise.

Sen. Bill Wielechowski is calling for an attorney general investigation into potential antitrust issues, The Alaska Dispatch News reported. He claims the potential for price gouging has increased since Tesoro Alaska became the state’s only gasoline refiner following the closure of Flint Hills Resources’ North Pole refinery in 2014.

“They can charge whatever they want,” Wielechowski said.

Matt Gill, manager of external affairs at Tesoro Alaska, denies that the company is manipulating prices. He said price changes have been the result of many factors, including a drop in the price of crude oil last fall that lowered prices at the pump, and a “correction” following that drop that caused a recent spike.

“The price of crude is just one of many factors,” Gill said.

Complaints about companies manipulating prices is not uncommon in Alaska, which regularly has some of the nation’s highest gas prices despite its abundant oil production and having the lowest gasoline taxes in the country.

Multiple state investigations over the years have found no illegal activity among refiners, distributors and sellers. The reviews have attributed price fluctuations to limited demand in a tiny market and a lack of refiners.

According to the American Automobile Association, the average price for gas in Alaska was $2.51 a gallon on Wednesday, about 56 cents higher than the national average.

In September, AAA statistics show Alaska’s monthly averages for gasoline dropped sharply after remaining at about $3.45 a gallon in July and August. In August, the state’s average monthly gasoline prices were 86 higher than the U.S. average. The difference was 27 cents in November.

Wielechowski said Alaska’s price fluctuations are connected to his previous request to the governor and attorney general for an investigation into the high petroleum prices. Gov. Bill Walker denied that request in a Dec. 21 letter to Wielechowski, saying “prices have fallen dramatically since September,” in southcentral Alaska.

Wielechowski has renewed his efforts for an investigation with a letter to Attorney General Craig Richards on Wednesday. The lawmaker pointed to Tesoro’s plan to buy two Flint Hills Resources terminals in Alaska along with other assets.

The deal, expected to close this month, will prevent competition in the state, and the acquisition of storage tanks will give Tesoro “total control” over gasoline prices in Alaska, Wielechowski said.

Gill said the terminals Tesoro plans to buy will be open to other companies, and prices for using them will be market-based and set by a Tesoro subsidiary.

 

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