WASHINGTON – The Federal Trade Commission said Wednesday it has not uncovered any anti-competitive behavior or other illegal business practices by oil companies that have caused current record gasoline prices.
"We have not seen evidence of illegal activity at this time. Evidence of illegal activity, I'm confident that we would take swift action" against the companies, Michael Salinger, director of the FTC's Bureau of Economics, told reporters after testifying at a congressional Joint Economic Committee hearing on oil industry mergers and gasoline costs.
The national price for regular unleaded gasoline hit a record high of $3.22 a gallon this week, up about $1 since the beginning of February, according to the Energy Department.
Democratic Sen. Charles Schumer, who chairs the committee, suggested at the hearing that the U.S. government consider breaking up some of the mega oil companies blamed by many for causing record gasoline prices.
Oil industry critics charge the giant mergers of several oil companies almost a decade ago has left only five major domestic oil firms controlling the majority of U.S. refining capacity, giving them the ability to restrict supplies and set gasoline prices.
"On the surface it looks like Big Oil is pumping cash rather than petrol," said Schumer. "Should we begin a serious exploration of whether or not to undo some of these mergers?"
The American Petroleum Institute trade group said the giant oil company mergers have led to production efficiencies and cut operating costs that have actually benefited consumers.
"Oil company mergers and acquisitions have not caused higher gasoline prices," said API President Red Cavaney.
Cavaney pointed out that gasoline production so far this year is at record highs, but so is fuel demand, which he said has lead to more expensive gasoline.
Cavaney also said that low gasoline imports, along with refining problems in petroleum exporting countries Venezuela and Nigeria, have helped to keep pump costs high.
Nonetheless, many lawmakers and consumers groups accuse oil companies of gouging drivers at the pump.
High gasoline prices have hurt family budgets, costing an extra $146 in fuel costs so far this year for each passenger car, but helped oil companies earn record profits.
"The American people suspect that high prices they are paying at the pump go straight to oil companies' profits. They're concerned that these profits are not going toward renewable energy alternatives or curbing the cost of gasoline at the pump," said Schumer.
The House on Wednesday will consider legislation to give the Federal Trade Commission more authority to go after oil companies that overcharge consumers.
Salinger told the committee that mergers of private oil companies have not significantly affected worldwide concentration in crude oil supplies, which he said was important because crude oil is the biggest cost of making gasoline.