Investigation of gas prices gets double the power

Gas prices are almost at $4 per gallon. This is the second time in three years that this particular mark has been reached. Dual federal agencies have agreed to cooperate with investigations ensuring the gasoline industry isn’t really being manipulated. The effects of this increased enforcement, however, could possibly be difficult to discern. Source of article – Federal agencies agree to cooperate on gas price investigation by MoneyBlogNewz.

Federal Trade Commission tries to address gas prices

There was a huge increase in gas in 2008. It got over $4 a gallon by the end of the year. A “Final Rule” got signed by the Federal Trade Commission a year later saying there was not allowed to be “fraud or deceit in wholesale petroleum markets, and omissions of material information that are likely to distort petroleum markets.” After the rule started, investigations started by the Federal Trade Commission. This was to look into the cost of oil going up so much. Despite these investigations, the Federal Trade Commission has not officially charged or fined any business with manipulation.

The agreement to cooperate with the Federal Trade Commission And CFTC both

The Commodity Futures Trading Commission (CFTC) is a smaller agency than the Federal Trade Commission, with a much narrower focus. Financial investments are made in physical goods, not businesses with Commodities and Futures. The 2 agencies will share information about the fuel industry not accessible to the public with the “Memorandum of Understanding” that the CFTC and FTC signed. In order to help stop abuses in the industry, the information is being shared between the businesses.

The way fuel costs are determined

There are many factors that attribute to the gas and fuel prices. It takes a few months before the oil price change reaches the market. Conflicts may change the fuel price. Also, the demand and cost of refining make a difference. The way the consumer feels has an effect on oil costs also. It will go up when consumers are nervous. There are often accusations of oil businesses gouging on fuel costs, though the FTC and CFTC rarely find enough evidence to prosecute perceived offenders.

Articles cited

The Price of Fuel

thepriceoffuel.com/whataffectsfuelpricing/

FTC

ftc.gov/opa/2009/08/mmr.shtm

CFTC

cftc.gov/