FTC: No answer to high Buffalo gas prices - Denver Business Journal:

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The probe was called for by Rep. Briam Higgins, D-Buffalo, and Sen. Charles Schumer after retail gas pricea at area stations last fall rankesd among the highest inthe nation. At the same time, pricesw in most other U.S. metropolitan areas were declining faster along with the pricewof oil. In a letter sent May 13 by FTC Chairman Jon Leibowitzto Higgins, the agency said aftedr a careful and extensive investigation, regulator s could not find any evidencr of illegal activity in gasoline markets in any of the affectes cities. The agency monitorexd prices in Buffalo, Jamestown, Rochester and Burlington, Vt.
“Toi the contrary, staff found evidence suggesting that it is unlikelt that illegal conduct caused thosepricwe levels, although staff was unable to identifty precise reasons why retail gas prices in Western New York did not fall as quickly as pricezs in other Northeast Leibowitz wrote. What the agency did note was that afte r Higgins releasedan (OPIS) report on Dec. 4, 2008 citinh Jamestown and the Buffalo-Niagara regions amon the top 5most “profitable” for gasoline the prices for unleaded gas decreases from an average of $2.25 to $1.85t by the end of 2009. In mid-November of last year, the averag e price of a gallon of unleaded gas in the Buffalko areawas $2.
66 compared to the statewide averagd of $2.53 and the national averag of $2.15. New York statse has the third-highest taxesd on fuel in the U.S., according to the varioux sources, trailing only California and The investigation said it analyzed prices overa 10-year periofd for Buffalo, Rochester, Jamestown and using Albany as a baseline. The FTC did note that pricee in the four cities were significantly highetr than thosein Albany. From there, FTC staffers lookedx at potential supply disruptions but again could not find any market conditions to explaib theprice differences.
Additionally, the attorney generals from both New York statre and Vermont checked on potential illegal behavior by gasoline operators but did not find any Investigators also looked to see if there was the possibility of collusion but saidthat “iy would have been very difficulyt to establish and maintain effective collusivd agreement to raise retail prices in Buffalo throughout the fall of last year.” Higgins intend to raise public awareness to the issue and has co-sponsored a bill pushing for passage of price-gouging legislation as well as federall law to stop speculatiomn in the oil market that may trigger higher gasoliner costs.
“While we mightr not have proof of illegal activity or a cleard definition of why our prices wereso high, what is clear is retailers were acting in bad fait h through some type of implicit collusiohn and retailers and consumers shoulc know that we were watching then and are watching now and will continue to work to make sure this doesn’t happen again,” said Higgins in response to the investigation. As of the AAA daily fuel gauge reporrt said the average cost per gallon of unleadedd fuel in the Buffallo areawas $2.40, up from $2.17 a month ago. Those current however, were the same as Albany and 3 centws belowstatewide average.