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Sen. Feinstein Suggests Probe of State's Gas Crisis

The state senator reminds FTC of past frauds, such as the 2000-2001 electrical crisis, which cost the state an estimated $40 billion and caused rolling blackouts.

California's senior senator today charged that California's record gasoline prices may be the "results of an illegal short squeeze" engineered by the handful of companies that refine gas here.

In a letter to the Federal Trade Commission, Sen. Dianne Feinstein, cited news reports that said Tesoro Corporation -- whose refinery in the South Bay went down for maintenance -- was taken advantage of by other gas suppliers "either through collusion or the use of market power."

"Publicly-available data appears to confirm that market fundamentals are not to blame for rising gas prices in California," the California democrat wrote in a letter to FTC chairman Jon Leibowitz.

Feinstein also called on the FTC to monitor energy price and production data gathered by other government agencies, to watch for "fraud, manipulation or other malicious trading practices."

She also urged the FTC to establish a permanent gas and oil oversight market committee, similar to the Federal Energy Regulatory Commission's oversight of the natural gas and electricity markets.

Feinstein said "California consumers are all-too-familiar with energy price spikes which cannot be explained by market fundamentals, and which turn out years later to have been the result of malicious and manipulative trading activity.

She reminded the FTC of past frauds, like the 2000-2001 electrical crisis, which turned out to have been caused by market manipulation by Enron and other traders. That fraud cost the state an estimated $40 billion, caused rolling blackouts, and is cited by some historians as having cost Gov. Gray Davis his political career.

SheSharpShoots October 08, 2012 at 07:10 AM
Outstanding Diane....I had just noted yesterday the .20 cent hick that happened OVER NIGHT! Excuse me. Yep, you keep digging Diane. And thank you!
Boo October 08, 2012 at 04:54 PM
It is due to onerous state environmental regs so you are right...it's not market forces.

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