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U.S.: Study implies CA gas price spikes were due to price manipulation, not shortages

 |  December 5, 2012

Reports are saying that documented spikes in gas prices in May and October of this year may have possibly been the result of price manipulation and not simply due to fuel shortages. While it is not the first time that price manipulation would have hit the California energy sector, this story cites reports of refineries in the state that were supposed to have been shut down for maintenance when, in fact, they were fully operational; the situation is reminiscent of the power crisis in California in the early 2000s, when some companies were found to have driven up wholesale prices of electricity when power generator plants were “shut down” for maintenance while actually still producing electricity. The practice not only increased prices for consumers, but also put energy retailers (who were forced to sell off those power generator plants) billions of dollars in debt. This time, a report suggests something similar may be occurring in the gas market; citing a McCullough study, refineries who were supposed to shut down operations were found to have not shut down at all – no differences were found between emission output measurements during operational times and during times when those refineries were supposedly closed. The McCullough study suggests that gas supply was not down in May or in October, when gas spikes occurred.

Full Content: San Diego Free Press

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