Federal Trade Commission Reports to Smith on Diesel Fuel Price Spikes

Federal Trade Commission Reports to Smith on Diesel Fuel Price Spikes

Today, Senator Gordon Smith (R-OR) released the preliminary findings of a Federal Trade Commission (FTC) investigation he requested into the escalation of diesel fuel prices in Oregon.

Copies of FTC Chairman Majoras' letter to Smith are available upon request

"With our economy finally gaining back its strength, we have to be vigilant for anything that might disrupt the recovery," Smith said. "While these findings explain some of the recent increases, I'm looking forward to seeing whether the costs come down as this report suggests they will."

In a letter to Smith, FTC Chairman Deborah Platt Majoras indicated that diesel fuel prices in five western states have risen above those experienced by the rest of the nation. Chairman Majoras stated that the increase can be attributed to several supply disruptions in the Pacific Northwest. According to Majoras, "multiple refineries in Washington - a major source of supply to Oregon - have recently experienced unit outages." Notably, Tesoro idled its Anacortes refinery for 30 days in February to perform maintenance and repairs. In addition, Olympic Pipeline was shut down for several days at the end of February. The FTC preliminary investigation reported that these disruptions were consistent with the diesel cost increases and that prices have already begun to stabilize and move back toward their predicted levels.

"Energy costs, whether electricity, gas, diesel or oil are tied inextricably to the economy and the livelihoods of millions," Smith said. "I'm going to continue monitoring this situation closely to ensure that these increases are only temporary and that prices return to normal as soon as possible."

http://gsmith.senate.gov/press/2004/03-14-05.htm