As gas prices hit record highs across the state, more than 75 members of the Maine Legislature are asking the state’s top prosecutor to investigate the possibility of price gouging. 

In a letter sent Thursday, members of both the Senate and House of Representatives asked Attorney General Aaron Frey to explore whether there is any “market manipulation” at play. 

“While the underlying causes of the increase in gas prices are complex, we cannot sit idly by and do nothing while people all across our state continue to struggle,” they wrote. 

Danna Hayes, spokesperson for the Maine Attorney General’s Office, said Friday via email that the office appreciates the Legislature’s outreach and is giving the letter “careful consideration.”

The letter was sent on the same day that the national average gas price hit $5 per gallon for the first time ever, according to GasBuddy, a Boston-based fuel price analysis firm that tracks fuel prices across the country.

Gas prices have been on the rise for months. 

According to GasBuddy, U.S. gasoline inventories have fallen by over 25 million barrels, or over one billion gallons, since the beginning of March. 

Gas and oil prices fell during the height of the pandemic due to low demand as lockdowns and travel restrictions kept motorists home. But as restrictions eased and people began to venture out again, demand started to rebound. Supply has not kept pace, causing prices to climb.

Then in early March, following Russia’s invasion of Ukraine, the United States imposed strict sanctions on Russia, including a ban on importing its oil.

Patrick DeHaan, head of petroleum analysis for GasBuddy, said in a news release that the compounding issues have created a rare environment of rapid price hikes. 

If demand continues to be strong, there’s a high probability that prices could continue to climb in the coming weeks, he said. DeHaan said earlier this week that worldwide demand for oil and gas is only expected to increase as China reopens its economy with the coronavirus pandemic appearing to ease. And Russia won’t be able to boost oil output because of sanctions, so that source of oil will remain tightly constrained.

BIG PROFITS RAISE SUSPICIONS

But the Maine Legislature is suggesting another factor might be at play.

For example, Senate President Troy Jackson and Speaker of the House Ryan Fecteau noted that Exxon Mobil tripled its first-quarter profit compared with last year, reporting net income of $8.8 billion. Online news outlet Vox reported last month that the country’s 21 largest companies took in $41 billion in profits during the first quarter of the year, an increase of $1.2 billion per company over the previous year.

“It would not be the first time that large corporations have used a crisis as an excuse to dramatically hike prices and line their shareholders’ pockets,” the Maine lawmakers wrote in their letter. “If petroleum companies are engaging in price gouging or other illegal activities they should be held accountable.”

The possibility of price gouging has been raised nationally, as well.

The U.S. House of Representatives last month narrowly approved a bill that would crack down on alleged price gouging by oil companies and other energy producers. The bill would give presidents the authority to declare an energy emergency that would make it unlawful to raise gasoline and home energy fuel prices in an “excessive” or exploitative manner. It would also direct the Federal Trade Commission to punish companies that engage in price gouging.

The proposed measure now goes to the Senate, but given that every House Republican (and four Democrats) voted against it, the bill is considered a long shot to become law.

New York is believed to be the first state to launch a probe into possible gas price gouging. In April, Attorney General Letitia James began examining New York’s entire supply chain “from production to pump,” CNN reported.

MAINE HITS $5.06 A GALLON

The average price for a gallon of regular gasoline in Maine was $5.06 on Friday, according to GasBuddy, with Franklin County reporting the highest countywide average at $5.16. Maine gas station operators Irving and Cumberland Farms did not respond Friday to calls seeking their reactions to Maine lawmakers’ letter.

California was reporting the highest statewide average on Friday at just shy of $6.20 a gallon, with some areas as high as $7.

In Massachusetts, where regular gasoline averaged $5.03 a gallon Friday, a gas station owner has drained his tanks in protest of the high prices and said he has no plans to refill them. Reynold Gladu, owner of Ren’s Mobil Service in Amherst, called the prices “the biggest ripoff that ever has happened to people in my lifetime,” according to The Daily Hampshire Gazette of Northampton.

Diesel is also at a record high nationally, at $5.76 per gallon. It’s even higher in Maine, at $6.20. That’s down from the previous state record of $6.39 last month.

The high price of diesel puts additional stress on the state’s independent truckers, farmers, fishermen, loggers and construction workers, Jackson and Fecteau said.

In March 2020, Gov. Janet Mills issued a declaration aimed at preventing the sale of essential products such as toilet paper, hand sanitizer, medicine and food at “unconscionable prices.” The order prohibited businesses from selling such products at more than a 15 percent markup from their prices immediately prior to the pandemic-related disruptions.

Anyone who believed they had witnessed price gouging was encouraged to contact the attorney general’s Consumer Protection Division.

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