askDNA
06-09-2006, 06:27 PM
The 30 percent increase in U.S. gasoline prices over the past year has put the
spotlight on the energy industry.
U.S. gasoline pump prices are comprised of four main components - the price of
crude oil; taxes; the cost of refining, transporting and marketing; and profit.
In the very best times, a company like ConocoPhillips makes just 10 cents a
gallon at the pump.
The factors affecting gasoline prices are complex and global. Currently, U.S.
gasoline prices are impacted largely by high crude oil prices, which are being
driven by strong global demand growth, limited excess production capacity, a
security premium caused by geopolitical risks, and higher industry costs. U.S.
gasoline prices also are being affected by tightness in the global refining
system and mandated changes in U.S. fuel specifications.
The world now consumes 85 million barrels of oil per day, a demand rate that has
been a major factor in reducing excess production capacity to less than 2
percent globally - a margin too narrow to protect against price spikes following
storms, refinery equipment failures or political disruptions in key-producing
regions. Oil demand growth from China has been particularly strong, tightening
the supply/demand balance and contributing to increased prices around the world.
Limited resource access is another critical factor in the world's ability to
meet growing demand. Approximately 65 percent of known reserves are controlled
by national oil companies, while international oil companies, like
ConocoPhillips, have direct access to just 7 percent of the world's known
reserves and indirect access to another 12 percent through joint ventures with
national oil companies. Private Russian companies have 16 percent of known
reserves; that's why ConocoPhillips' equity stake and joint venture with LUKOIL
is so important. Further, access to U.S. resources is limited in several
promising locations, including much of the Gulf of Mexico, the East and West
Coasts and areas of the Arctic Coast in Alaska.
In addition to the impact of high crude oil prices, U.S. retail gasoline prices
also are affected by the fact that, globally, refineries are running at high
levels of capacity utilization. Therefore, any outage - due to natural disaster,
incident or even routine turnaround - results in significantly higher prices.
While the addition of capacity seems an obvious solution, in recent years,
refinery capacity expansion has been hindered by weak historical profitability,
required capital improvements toward clean fuels and emissions reductions, and
difficulty in permitting new capacity or expansions.
Finally, boutique fuels and specification changes have contributed to gasoline
price volatility in the United States. The industry is required to produce about
100 different types of gasoline in the United States today, making it difficult
to meet regional demand or move supplies from region to region in the event of a
disruption of gasoline production in one or more regions. The switchover from
MTBE to ethanol, as well as the phase-in of low-sulfur gasoline and ultra
low-sulfur diesel, also is creating logistical delivery problems.
In the search for solutions to these and other forces pushing the price of
gasoline higher, ConocoPhillips is investing in organic growth projects,
exploration, refining, and research for alternative technology that is safe and
environmentally responsible. (Please see related story on reinvesting.)
But the solution to high gasoline prices cannot be accomplished by a single
company - or, for that matter, a single industry, government or consumer group.
The issues that have pushed the world's energy market to this point must be
addressed holistically, with input from all parties, to achieve balanced,
thoughtful remedies to the fundamental access and infrastructure issues
identified in this article.
Oil Company Profits
* What do oil companies make on a gallon of gasoline?
* Shouldn't the government regulate oil profits?
* Why are oil company profits so large?
* What happens to those oil profits?
* How do oil profits compare with those of other industries?
* How do consumers know that oil companies aren't price gouging?
What do oil companies make on a gallon of gasoline?
A multitude of factors can affect an individual oil company's profit on gasoline
sales. However, in general, if gasoline is selling at about $3 a gallon, major
companies make a profit of about 10 cents a gallon on their U.S. refining and
marketing operations based on data gathered by the Energy Information
Administration (EIA). Profitability factors include the efficiency of the firm's
refining, distribution and marketing system, as well as its source of raw
material. In times of rising oil prices, companies that own and produce a
considerable portion of the crude oil used in their refineries may benefit more
than other companies that must purchase most or all of their supplies on the
open market.
Crude oil generally represents the single greatest cost component of gasoline,
which explains why gasoline prices rise and fall so quickly with changes in the
world price of crude oil. For example, at ConocoPhillips, crude oil costs make
up 85 to 90 percent of the total costs of running its refineries. As an
international commodity, crude oil is bought and sold 24 hours a day, so its
price is changing constantly. In the matter of a day or two, crude oil prices
can move up or down by several dollars, depending upon supply and demand
factors.
In general, crude oil accounts for roughly half of gasoline's price, as shown in
the graphic. Other price components include refining, distribution (pipelines
and tanker trucks) and marketing (service stations and convenience stores).
These so-called "downstream" costs have been falling as companies have made
operations more efficient. When gasoline reaches the pump, another major factor
comes into play - federal, state and local taxes, which average about 20 percent
or more of the pump price. The federal tax is 18.4 cents per gallon, while state
and local taxes vary from 8 cents in Alaska to nearly 50 cents per gallon in New
York.
Find out more out at...
Weekly Update on Gasoline Prices
<http://www.eia.doe.gov/oil_gas/petroleum/special/gasoline_update/market_summary.html (javascript:ol('http://www.eia.doe.gov/oil_gas/petroleum/special/gasoline_update/market_summary.html');)>,
a report compiled by the U.S. Energy Information Administration.
Analysis of Oil Company Tax Payments
<http://api-ec.api.org/filelibrary/Tax%20Foundation%20Study%20Tax%20Payments%20Undercut%20WPT.pdf (javascript:ol('http://api-ec.api.org/filelibrary/Tax Foundation Study Tax Payments Undercut WPT.pdf');)>,
a brief report reviewing the taxes paid by America's three largest oil companies
in 2005, compiled by the Tax Foundation.
Why are oil company profits so large?
Profits of major oil companies in 2005 were considerably higher than the
previous year's. The big percentage increase helped support the impression that
oil profits are excessive, but business analysts stress that other measures
should be considered in assessing a company's or industry's profit picture.
Business Week magazine, for example, regularly monitors the profitability of
various companies and industries by comparing their profit margins. To determine
profit margin, the magazine divides net income by total revenue. In the case of
oil and gas companies, total sales consist of the money they receive from
selling their products, as well as revenue received from any other sources. Net
income is the money left over after all costs and taxes are paid.
Over the long haul oil profits generally remain below or on a par with those of
other major industries. As the chart indicates, the Business Week analysis of
the data from the five-year period of Sept. 2000 to Sept. 2005, shows that the
profitability of oil and natural gas companies (5.8 cents per dollar of sales)2
has been just slightly above the profitability of all industries combined.
Not to be confused with profit margin on each gallon of gasoline sold, as
described in the first question.
How do oil profits compare with those of other industries?
Business Week magazine regularly compares the profitability of various
industries and companies on the basis of profit margin, which is calculated by
dividing net income (profit) by total sales and other revenues. For example, a
software company that clears $90 million in net income on product sales of $1
billion would earn a profit margin of 9 percent or 9 cents on each dollar of
sales.
Traditionally, oil companies have trailed many other industries in this measure
of profitability. As indicated in the graphic, the profit margin of energy
companies was slightly above that of all industry in 2005. However, the
industry's profitability remained below the profit margins of other industries
such as banking, pharmaceuticals, real estate, and household and personal
products.
Find out more out at...
Oil Industry Earnings Compared with Other Industries in 2005
<http://api-ec.api.org/filelibrary/4QTR-earnings-vs-all-industry.pdf (javascript:ol('http://api-ec.api.org/filelibrary/4QTR-earnings-vs-all-industry.pdf');)>, an
overview compiled by the American Petroleum Institute using data from Business
Week and other sources.
Energy Finance <http://www.eia.doe.gov/emeu/finance/ (javascript:ol('http://www.eia.doe.gov/emeu/finance/');)>, a gateway to energy
industry financial and operating data compiled by the U.S. Energy Information
Administration.
Shouldn't the government regulate oil profits?
History serves as a helpful teacher on this question. As part of a general
effort to combat high inflation in the early 1970s, President Nixon placed price
controls on the oil industry and many other sectors of the American economy.
Eventually the controls were lifted from other industries, but they remained in
place for U.S.-produced oil as the government tried to partially protect
consumers from the jump in world oil prices caused by the oil embargo of
1973-74. A so-called windfall profits tax was imposed on the industry in 1980,
when again world oil prices rose dramatically as a result of supply disruptions
stemming from conflicts in Iran and Iraq. The government began phasing out the
tax in 1981.
Although various price and profit control programs did limit income to oil
companies, it's questionable whether they benefited consumers in the long run.
Between 1974 and 1980, imported oil prices averaged about 50 percent more than
the price for oil produced in America. As a consequence, U.S. oil companies were
discouraged from exploring for and finding supplies of oil and natural gas at
home. Meanwhile, industrial and individual consumers were shielded from higher
prices that might have encouraged greater energy conservation.
A report by the U.S. Energy Information Administration (EIA) that surveyed the
events in the 25 years following the 1973-74 oil embargo concluded that federal
price controls and allocations systems not only "failed to resolve these
problems (electricity brownouts and rapidly rising prices), they seemed to
aggravate them."
According to a 1990 Report of the Congressional Research Service, the windfall
profits tax that was signed into law in 1980 and repealed in 1988 drained $79
billion in industry revenues during the 1980s that could have been used to
invest in new oil production - leading to 1.6 billion fewer barrels of oil being
produced in the U.S. from 1980-1988. The tax reduced domestic oil production as
much as 6 percent, and increased oil imports as much as 16 percent.
As the graphic shows, gasoline prices since the early 1980s have risen at a
slower rate than many other essential consumer items, including food, housing,
educational and medical care.
What happens to those oil profits?
Basically, oil company profits are used for two purposes - to pay dividends to
shareholders in the business and to pay for capital investments to find,
produce, process and deliver energy products to consumers.
Shareholder Dividends: Millions of Americans own stock in oil companies either
directly as shareholders, as owners of mutual fund shares or as participants in
pension fund and other retirement accounts. Each year, dividends paid by oil
companies put hundreds of millions of dollars into the hands of the public.
Capital Investments: By far the largest portion of oil profits goes back into
the business to find and develop resources and improve and expand facilities.
Consumers most often see industry capital investments in the form of new or
upgraded marketing outlets, such as local convenience stores. But in reality,
investments in the retail marketing business are small when compared to the
massive amounts of money spent by the industry in places that few consumers ever
see - such as the middle of the North Sea, the Alaskan North Slope or the deep
waters of the Gulf of Mexico. In these far flung locations and in countless
other places around the world, companies must search for new resources of oil
and natural gas to replace the supplies that are being depleted daily by
consumer demand.
Higher prices provide greater incentive to look for oil and gas in more remote,
expensive locations. The investment firm Morgan Stanley recently estimated that
the cost of finding and developing oil on a per barrel basis is three times
greater today than in 1999. As the graph indicates, in response to the rising
price environment of the last several years, the industry has steadily increased
its capital expenditures for exploration and production of energy. In the case
of ConocoPhillips, the company expects to invest an average of $1.5 billion a
month during 2006 to maintain and expand energy supply. By contrast, the
company's profits (net income) in the last 12-month period (April 2005 to March
2006) averaged about $1.2 billion a month.
The oil industry is termed a "capital intensive" industry because so much of its
work requires the expenditure of millions and sometimes billions of dollars even
for a single project. Here are some examples based on estimates for energy
projects in which ConocoPhillips is participating:
* $4-5 billion to increase the capability of refineries to produce 15 percent
more gasoline, diesel and heating oil by 2011.
* $1.5 billion to build new terminals to receive shipments of liquefied natural
gas (LNG) from aboard to meet U.S. market needs.
* $20-25 billion for a pipeline to transport natural gas from the Alaska North
Slope to the Lower 48 states.
top
How do consumers know that oil companies aren't price gouging?
The U.S. government has investigated gasoline prices about 30 times over the
last 20 years but oil companies were never found to have "fixed" prices. Most
recently, the Federal Trade Commission (FTC) completed an exhaustive study of
alleged market manipulation to increase gasoline prices in the weeks following
Hurricane Katrina late last summer. The FTC report, released in May 2006,
included these findings:
* No evidence that refiners manipulated prices by running refineries below full
production capacity, restricting gasoline production or diverting gasoline from
the U.S. market to less lucrative foreign markets.
* No evidence to suggest refinery expansion decisions over the past 20 years
resulted from either unilateral or coordinated attempts to manipulate prices.
* No evidence to suggest companies reduced inventories to increase or manipulate
prices or exacerbate price spikes.
* No situations that might allow one firm - or a small collusive group - to
manipulate gasoline futures prices by using storage assets to restrict gasoline
movements into New York Harbor, the key delivery point for gasoline.
Find out more at...
Post-Hurricane Gasoline Price Investigation
<http://www.ftc.gov/opa/2006/05/katrinagasprices.htm (javascript:ol('http://www.ftc.gov/opa/2006/05/katrinagasprices.htm');)>, a summary of the major
findings of this extensive investigation, compiled by the Federal Trade
Commission.
Enjoy.......
spotlight on the energy industry.
U.S. gasoline pump prices are comprised of four main components - the price of
crude oil; taxes; the cost of refining, transporting and marketing; and profit.
In the very best times, a company like ConocoPhillips makes just 10 cents a
gallon at the pump.
The factors affecting gasoline prices are complex and global. Currently, U.S.
gasoline prices are impacted largely by high crude oil prices, which are being
driven by strong global demand growth, limited excess production capacity, a
security premium caused by geopolitical risks, and higher industry costs. U.S.
gasoline prices also are being affected by tightness in the global refining
system and mandated changes in U.S. fuel specifications.
The world now consumes 85 million barrels of oil per day, a demand rate that has
been a major factor in reducing excess production capacity to less than 2
percent globally - a margin too narrow to protect against price spikes following
storms, refinery equipment failures or political disruptions in key-producing
regions. Oil demand growth from China has been particularly strong, tightening
the supply/demand balance and contributing to increased prices around the world.
Limited resource access is another critical factor in the world's ability to
meet growing demand. Approximately 65 percent of known reserves are controlled
by national oil companies, while international oil companies, like
ConocoPhillips, have direct access to just 7 percent of the world's known
reserves and indirect access to another 12 percent through joint ventures with
national oil companies. Private Russian companies have 16 percent of known
reserves; that's why ConocoPhillips' equity stake and joint venture with LUKOIL
is so important. Further, access to U.S. resources is limited in several
promising locations, including much of the Gulf of Mexico, the East and West
Coasts and areas of the Arctic Coast in Alaska.
In addition to the impact of high crude oil prices, U.S. retail gasoline prices
also are affected by the fact that, globally, refineries are running at high
levels of capacity utilization. Therefore, any outage - due to natural disaster,
incident or even routine turnaround - results in significantly higher prices.
While the addition of capacity seems an obvious solution, in recent years,
refinery capacity expansion has been hindered by weak historical profitability,
required capital improvements toward clean fuels and emissions reductions, and
difficulty in permitting new capacity or expansions.
Finally, boutique fuels and specification changes have contributed to gasoline
price volatility in the United States. The industry is required to produce about
100 different types of gasoline in the United States today, making it difficult
to meet regional demand or move supplies from region to region in the event of a
disruption of gasoline production in one or more regions. The switchover from
MTBE to ethanol, as well as the phase-in of low-sulfur gasoline and ultra
low-sulfur diesel, also is creating logistical delivery problems.
In the search for solutions to these and other forces pushing the price of
gasoline higher, ConocoPhillips is investing in organic growth projects,
exploration, refining, and research for alternative technology that is safe and
environmentally responsible. (Please see related story on reinvesting.)
But the solution to high gasoline prices cannot be accomplished by a single
company - or, for that matter, a single industry, government or consumer group.
The issues that have pushed the world's energy market to this point must be
addressed holistically, with input from all parties, to achieve balanced,
thoughtful remedies to the fundamental access and infrastructure issues
identified in this article.
Oil Company Profits
* What do oil companies make on a gallon of gasoline?
* Shouldn't the government regulate oil profits?
* Why are oil company profits so large?
* What happens to those oil profits?
* How do oil profits compare with those of other industries?
* How do consumers know that oil companies aren't price gouging?
What do oil companies make on a gallon of gasoline?
A multitude of factors can affect an individual oil company's profit on gasoline
sales. However, in general, if gasoline is selling at about $3 a gallon, major
companies make a profit of about 10 cents a gallon on their U.S. refining and
marketing operations based on data gathered by the Energy Information
Administration (EIA). Profitability factors include the efficiency of the firm's
refining, distribution and marketing system, as well as its source of raw
material. In times of rising oil prices, companies that own and produce a
considerable portion of the crude oil used in their refineries may benefit more
than other companies that must purchase most or all of their supplies on the
open market.
Crude oil generally represents the single greatest cost component of gasoline,
which explains why gasoline prices rise and fall so quickly with changes in the
world price of crude oil. For example, at ConocoPhillips, crude oil costs make
up 85 to 90 percent of the total costs of running its refineries. As an
international commodity, crude oil is bought and sold 24 hours a day, so its
price is changing constantly. In the matter of a day or two, crude oil prices
can move up or down by several dollars, depending upon supply and demand
factors.
In general, crude oil accounts for roughly half of gasoline's price, as shown in
the graphic. Other price components include refining, distribution (pipelines
and tanker trucks) and marketing (service stations and convenience stores).
These so-called "downstream" costs have been falling as companies have made
operations more efficient. When gasoline reaches the pump, another major factor
comes into play - federal, state and local taxes, which average about 20 percent
or more of the pump price. The federal tax is 18.4 cents per gallon, while state
and local taxes vary from 8 cents in Alaska to nearly 50 cents per gallon in New
York.
Find out more out at...
Weekly Update on Gasoline Prices
<http://www.eia.doe.gov/oil_gas/petroleum/special/gasoline_update/market_summary.html (javascript:ol('http://www.eia.doe.gov/oil_gas/petroleum/special/gasoline_update/market_summary.html');)>,
a report compiled by the U.S. Energy Information Administration.
Analysis of Oil Company Tax Payments
<http://api-ec.api.org/filelibrary/Tax%20Foundation%20Study%20Tax%20Payments%20Undercut%20WPT.pdf (javascript:ol('http://api-ec.api.org/filelibrary/Tax Foundation Study Tax Payments Undercut WPT.pdf');)>,
a brief report reviewing the taxes paid by America's three largest oil companies
in 2005, compiled by the Tax Foundation.
Why are oil company profits so large?
Profits of major oil companies in 2005 were considerably higher than the
previous year's. The big percentage increase helped support the impression that
oil profits are excessive, but business analysts stress that other measures
should be considered in assessing a company's or industry's profit picture.
Business Week magazine, for example, regularly monitors the profitability of
various companies and industries by comparing their profit margins. To determine
profit margin, the magazine divides net income by total revenue. In the case of
oil and gas companies, total sales consist of the money they receive from
selling their products, as well as revenue received from any other sources. Net
income is the money left over after all costs and taxes are paid.
Over the long haul oil profits generally remain below or on a par with those of
other major industries. As the chart indicates, the Business Week analysis of
the data from the five-year period of Sept. 2000 to Sept. 2005, shows that the
profitability of oil and natural gas companies (5.8 cents per dollar of sales)2
has been just slightly above the profitability of all industries combined.
Not to be confused with profit margin on each gallon of gasoline sold, as
described in the first question.
How do oil profits compare with those of other industries?
Business Week magazine regularly compares the profitability of various
industries and companies on the basis of profit margin, which is calculated by
dividing net income (profit) by total sales and other revenues. For example, a
software company that clears $90 million in net income on product sales of $1
billion would earn a profit margin of 9 percent or 9 cents on each dollar of
sales.
Traditionally, oil companies have trailed many other industries in this measure
of profitability. As indicated in the graphic, the profit margin of energy
companies was slightly above that of all industry in 2005. However, the
industry's profitability remained below the profit margins of other industries
such as banking, pharmaceuticals, real estate, and household and personal
products.
Find out more out at...
Oil Industry Earnings Compared with Other Industries in 2005
<http://api-ec.api.org/filelibrary/4QTR-earnings-vs-all-industry.pdf (javascript:ol('http://api-ec.api.org/filelibrary/4QTR-earnings-vs-all-industry.pdf');)>, an
overview compiled by the American Petroleum Institute using data from Business
Week and other sources.
Energy Finance <http://www.eia.doe.gov/emeu/finance/ (javascript:ol('http://www.eia.doe.gov/emeu/finance/');)>, a gateway to energy
industry financial and operating data compiled by the U.S. Energy Information
Administration.
Shouldn't the government regulate oil profits?
History serves as a helpful teacher on this question. As part of a general
effort to combat high inflation in the early 1970s, President Nixon placed price
controls on the oil industry and many other sectors of the American economy.
Eventually the controls were lifted from other industries, but they remained in
place for U.S.-produced oil as the government tried to partially protect
consumers from the jump in world oil prices caused by the oil embargo of
1973-74. A so-called windfall profits tax was imposed on the industry in 1980,
when again world oil prices rose dramatically as a result of supply disruptions
stemming from conflicts in Iran and Iraq. The government began phasing out the
tax in 1981.
Although various price and profit control programs did limit income to oil
companies, it's questionable whether they benefited consumers in the long run.
Between 1974 and 1980, imported oil prices averaged about 50 percent more than
the price for oil produced in America. As a consequence, U.S. oil companies were
discouraged from exploring for and finding supplies of oil and natural gas at
home. Meanwhile, industrial and individual consumers were shielded from higher
prices that might have encouraged greater energy conservation.
A report by the U.S. Energy Information Administration (EIA) that surveyed the
events in the 25 years following the 1973-74 oil embargo concluded that federal
price controls and allocations systems not only "failed to resolve these
problems (electricity brownouts and rapidly rising prices), they seemed to
aggravate them."
According to a 1990 Report of the Congressional Research Service, the windfall
profits tax that was signed into law in 1980 and repealed in 1988 drained $79
billion in industry revenues during the 1980s that could have been used to
invest in new oil production - leading to 1.6 billion fewer barrels of oil being
produced in the U.S. from 1980-1988. The tax reduced domestic oil production as
much as 6 percent, and increased oil imports as much as 16 percent.
As the graphic shows, gasoline prices since the early 1980s have risen at a
slower rate than many other essential consumer items, including food, housing,
educational and medical care.
What happens to those oil profits?
Basically, oil company profits are used for two purposes - to pay dividends to
shareholders in the business and to pay for capital investments to find,
produce, process and deliver energy products to consumers.
Shareholder Dividends: Millions of Americans own stock in oil companies either
directly as shareholders, as owners of mutual fund shares or as participants in
pension fund and other retirement accounts. Each year, dividends paid by oil
companies put hundreds of millions of dollars into the hands of the public.
Capital Investments: By far the largest portion of oil profits goes back into
the business to find and develop resources and improve and expand facilities.
Consumers most often see industry capital investments in the form of new or
upgraded marketing outlets, such as local convenience stores. But in reality,
investments in the retail marketing business are small when compared to the
massive amounts of money spent by the industry in places that few consumers ever
see - such as the middle of the North Sea, the Alaskan North Slope or the deep
waters of the Gulf of Mexico. In these far flung locations and in countless
other places around the world, companies must search for new resources of oil
and natural gas to replace the supplies that are being depleted daily by
consumer demand.
Higher prices provide greater incentive to look for oil and gas in more remote,
expensive locations. The investment firm Morgan Stanley recently estimated that
the cost of finding and developing oil on a per barrel basis is three times
greater today than in 1999. As the graph indicates, in response to the rising
price environment of the last several years, the industry has steadily increased
its capital expenditures for exploration and production of energy. In the case
of ConocoPhillips, the company expects to invest an average of $1.5 billion a
month during 2006 to maintain and expand energy supply. By contrast, the
company's profits (net income) in the last 12-month period (April 2005 to March
2006) averaged about $1.2 billion a month.
The oil industry is termed a "capital intensive" industry because so much of its
work requires the expenditure of millions and sometimes billions of dollars even
for a single project. Here are some examples based on estimates for energy
projects in which ConocoPhillips is participating:
* $4-5 billion to increase the capability of refineries to produce 15 percent
more gasoline, diesel and heating oil by 2011.
* $1.5 billion to build new terminals to receive shipments of liquefied natural
gas (LNG) from aboard to meet U.S. market needs.
* $20-25 billion for a pipeline to transport natural gas from the Alaska North
Slope to the Lower 48 states.
top
How do consumers know that oil companies aren't price gouging?
The U.S. government has investigated gasoline prices about 30 times over the
last 20 years but oil companies were never found to have "fixed" prices. Most
recently, the Federal Trade Commission (FTC) completed an exhaustive study of
alleged market manipulation to increase gasoline prices in the weeks following
Hurricane Katrina late last summer. The FTC report, released in May 2006,
included these findings:
* No evidence that refiners manipulated prices by running refineries below full
production capacity, restricting gasoline production or diverting gasoline from
the U.S. market to less lucrative foreign markets.
* No evidence to suggest refinery expansion decisions over the past 20 years
resulted from either unilateral or coordinated attempts to manipulate prices.
* No evidence to suggest companies reduced inventories to increase or manipulate
prices or exacerbate price spikes.
* No situations that might allow one firm - or a small collusive group - to
manipulate gasoline futures prices by using storage assets to restrict gasoline
movements into New York Harbor, the key delivery point for gasoline.
Find out more at...
Post-Hurricane Gasoline Price Investigation
<http://www.ftc.gov/opa/2006/05/katrinagasprices.htm (javascript:ol('http://www.ftc.gov/opa/2006/05/katrinagasprices.htm');)>, a summary of the major
findings of this extensive investigation, compiled by the Federal Trade
Commission.
Enjoy.......