My first post C&L ever linked to was a May 2007 Op/Ed on how oil companies appeared to be shutting down refineries "for maintenance" to deliberately (IMHO) drive up gas prices the same way Enron drove up electricity prices in California in 2000, the year before they collapsed in scandal. You might recall that back in the Spring of 2000, California was plagued by rolling blackouts because of electricity plants closed "due to maintenance". Most people still remember those secret audio recordings (NSFW) on the news of two young Enron Energy Traders joking about having to repay the money they stole from "Grandma Millie" in California, or CEO Jeff Skilling comparing California to the Titanic.
Fast forward 12 years (though I HIGHLY doubt the practice ever ceased) to last May & October. Reports were all over the news of gas prices spiking well over $4/gal in California, despite the fact gas & oil supplies were UP and gas prices were DOWN in the rest of the country. The reason for the 50cent/gallon spike in California? Several large oil refineries supposedly had to be "shutdown for maintenance" (according to McClatchy, May's West Coast spike was partly blamed on a Feb. 18 fire at BP's Cherry Point refinery in Washington. October's California spike was explained as partly a market reaction to an Aug. 6 fire at Chevron's Richmond refinery... both spikes taking place MONTHS after those fires and independent of the "closures" that supposedly interrupted supply.)
A McClatchy News investigation has found evidence that during the refinery closures in May that were behind the spike in gas prices, the plants were actually up & running at least part of that time... perhaps even the entire time... and producing gasoline. So why the spike in prices?
In response to this information, Democratic Senators in Congress (THIS is why Dem majorities are so important) led by Sen. Maria Cantwell have called for a formal investigation into whether oil companies have been deliberately closing... or even entirely falsely claiming the closure of... oil refineries for the sole purpose of market manipulation and driving gas prices up.
Just as we saw with Enron in 2000, and just as I reported back in 2007, the practice of artificially limiting the supply of energy just to push up prices by greedy energy executives is nothing new, but unlike in 2000 and 2007, Democrats now control both the White House and part of Congress, making a serious investigation with tangible consequences that much more likely. A Credit Suisse report last February claims every one-penny increase in the price of gasoline sucks one-Billion dollars annually out of the economy (I'd argue the number is FAR higher, because higher fuel costs means higher transportation costs for stores, increasing prices, doubling the impact. While slower sales mean layoffs that contract the economy still further.)
Tell me again GOP how "deregulation" helps the economy? Please. I really want to hear your answer on this one.
