NATSO urged the Senate Commerce Committee in a May 25 letter to oppose new gas price gouging legislation unless it is substantially changed to ensure it will help, not hurt, efforts to address rising fuel prices.
Senate Bill S. 4217 singles out motor fuel sales for legal scrutiny and peril.
“We all oppose gouging and market manipulation, which harms the American public and the retail fueling industry as a whole. That said, these unlawful activities are exceedingly rare,” NATSO wrote. “Neither gouging nor market manipulation are a characteristic or driving force of the retail market prices we see today.”
NATSO was joined in signing the letter by the National Association of Convenience Stores (NACS) and SIGMA: America’s Leading Fuel Marketers.
The groups said the bill “misses the mark of the factors that are driving high fuel prices” and that “its passage will not result in lower prices. In fact, the substantial costs and burdens of compliance with the bill paired with the risks created from the collection of highly competitive sensitive information are far more likely to increase than decrease prices.”
The bill, which is similar to legislation narrowly passed by the House last week, would double the maximum penalty on those found to be manipulating wholesale oil market prices. The bill failed to advance out of the Commerce Committee in a Wednesday vote, though Senate Democratic leadership has expressed interest in filing a discharge petition so that the legislation can receive a vote on the Senate floor.
The retail fuels market is the most transparent, competitive commodities market in the United States. Customers can see gasoline retailers’ price signs from blocks away, or compare prices on cell phone applications. Transparent, competitive pricing coupled with consumers’ price-sensitivity exerts a constant downward pressure on retail fuel prices and forces successful retailers to run efficient and cost competitive business platforms.
Moreover, fuel retailers are generally independent businesses. Although some might bear the name of a large oil company, this is not indicative of any ownership stake in the business or the real estate, but simply of a marketing relationship or announcement to passing motorists that a certain company’s product is available for purchase at that location.
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