29 May 2009

Manchin Scolds Fuel Distributor

Gov. Joe Manchin is "totally disappointed" after Marathon Oil Corp. announced it is "cutting off independent stations in the Charleston area," in the wake of recent flooding, The Associated Press and others report.

Manchin says Marathon took action after his May 9 disaster declaration triggered price-gouging laws that limit price increases," AP reports. "The declaration was issued after flooding and other weather-related damage hit several southern counties."

In a Thursday statement, the governor said "t
he anti-price-gouging laws allow businesses to increase prices to recoup costs if the increase is directly attributable to additional costs imposed on the business. Despite this, Marathon officials expressed concern over how West Virginia’s law could be interpreted to affect their distribution operations."

Marathon later told AP that it "cut off gas deliveries to some independent stations in West Virginia because of market forces and the state’s disaster price-gouging law."

"Angela Graves said Friday the company is still supplying more than 90 percent of its customers in areas covered by Gov. Joe Manchin’s May 9 disaster declaration," that AP report said. "Graves says these customers are independent businesses that have supply contracts with Marathon and the company is fulfilling its contracts."

Manchin's statement noted that "branded stations (Speedway, Marathon, etc.) are not affected by this stoppage. For the time being, independent dealers will be forced to drive to other distribution centers outside the state or in other parts of the state not within the emergency declaration."

Records from the fuel distributor were subpoenaed by officials in neighboring Kentucky last year amid a "gas price-gouging investigation that occurred in the wake of Hurricane Ike and the subsequent windstorm" there.

Those officials were also probing wholesale gas pricing in the Louisville area. In January, they "formally requested federal anti-trust authorities to review the 1997 merger of Marathon and Ashland Oil and its impact on the entire Kentucky petroleum market," their statement said.

The Charleston Gazette also has an item, as does MetroNews.

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