Senator Feinstein requests that FTC investigate possible illegal “short squeeze” by gas companies

SOUTHERN CALIF. (Wire Service)- California’s senior senator today charged that California’s record gasoline prices may be the “results of an illegal short squeeze” engineered by the handful of companies that refine gas here.

In a letter to the Federal Trade Commission, Sen. Dianne Feinstein cited news reports that said Tesoro Corporation — whose refinery near San Pedro went down for maintenance — was taken advantage of by other gas suppliers “either through collusion or the use of market power.”

“Publicly-available data appears to confirm that market fundamentals are not to blame for rising gas prices in California,” the California democrat wrote in a letter to FTC chairman Jon Leibowitz.

Feinstein also called on the FTC to monitor energy price and production data gathered by other government agencies, to watch for “fraud, manipulation or other malicious trading practices.”

She also urged the FTC to establish a permanent gas and oil oversight market committee, similar to the Federal Energy Regulatory Commission’s oversight of the natural gas and electricity markets.

Feinstein said “California consumers are all-too-familiar with energy price spikes which cannot be explained by market fundamentals, and which turn out years later to have been the result of malicious and manipulative trading

activity.

She reminded the FTC of past frauds, like the 2000-2001 electrical crisis, which turned out to have been caused by market manipulation by Enron and other traders. That fraud cost the state an estimated $40 billion, caused rolling blackouts, and is cited by some historians as having cost Gov. Gray Davis his political career.

6 Responses to "Senator Feinstein requests that FTC investigate possible illegal “short squeeze” by gas companies"

  1. Oh Please...   October 8, 2012 at 6:09 am

    Because crushing regulations and taxes have nothing to do with the sky high price of gas in Southern California. Feinstein has a lot of nerve calling the kettle black. Political beasts such as her should look in the mirror before they blame something or someone else for their failures.

    Reply
  2. Pumped up   October 8, 2012 at 12:13 pm

    The real reason we have shortages like this is because nobody wants to build refineries anymore. NIMBY attitudes and environmental regulations enforced by a bunch of idiots means we haven’t built a new refinery in years and have closed down most of our smaller ones. And lets not even get into the taxes.

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  3. Riiiiiiiight....   October 8, 2012 at 12:30 pm

    The only reason gas prices are this high in JUST California – DEMOCRATS have put so many stupid regulations in place. California was known as the Golden State when we had Republicans in charge. Now we are just a joke.

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  4. FR86   October 8, 2012 at 12:30 pm

    Once again an incumbent politician is “outraged” at he same issue that they should have done something about the first time a long time ago……..

    What is necessary are national leaders that take the oil industry to task and that aren’t in their vest pockets.

    We’ve needed an energy policy that frees us all from foreign oil, makes us self sufficient and capitalizes on what we have in natural energy fuel sources as well as atomic energy.

    These two that we have as senators are the problem as much as the oil companies. We shoul harness their “wind” and hot air power as a start.

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  5. Say what?   October 9, 2012 at 7:38 am

    When oil companies are making record profits, are subsidized millions of dollars each year by congress, and are given tax incentives for investments and new equipment, they can afford to build new refineries with the regulations. Bottom line is they can screw us all they want for bigger profits and get away with it.

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  6. Get Real.   October 10, 2012 at 3:52 pm

    So funny Lady Di…Feinstein is also front and center as a war profiteer, and most definitely front and center for leading corruption within Congress. She was forced to resign from her position as Chair of the Senate Military Appropriations Subcommittee as she was in charge of reviewing the multi-billion dollar contracts for construction work with the U.S. military, then approving the contracts worth billions of dollars for her husband

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