Energy & Environment

FTC to probe for any ‘collusive’ practices on gas prices

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Federal antitrust regulators will look into whether there are any “collusive” or otherwise illegal practices impacting gas prices following a request from the White House. 

Federal Trade Commission (FTC) Chairwoman Lina Khan said in a letter to Brian Deese, who directs the National Economic Council, that she’ll direct staff to take actions on mergers and franchising. 

Specifically, Khan said in the letter, which was obtained by The Hill, that she’ll ask staff to investigate “abuses” in the franchise market. 

“Many retail fuel stations are franchised, but most franchisees have no control over prices at the pump. We will need to determine whether the power imbalance favoring large national chains allows them to force their franchisees to sell gasoline at higher prices, benefitting the chain at the expense of the franchisee’s convenience store operations,“ Khan said. 

She also said she’d seek to identify “additional legal theories” to challenge fuel station mergers where major companies are buying up family-owned businesses, which she said could lead to collusion on price. 

“I am especially interested in ways that large national chains may ‘restore’ higher prices through collusive practices, and I will direct our staff to investigate any signs of this type of conduct,” she wrote. 

Khan also pointed to an existing move to reinstate a policy from decades ago that required companies that broke the law in previous mergers to get prior approval from the commission for future transactions. 

Her letter, dated Wednesday, came after Deese asked the FTC to look into “divergences” between oil prices and what people are paying at the pump.

Analysts told The Hill at the time that they didn’t expect any such probe to reveal irregularities, citing high labor costs, driver shortages and refinery closures as among the possible reasons for high gasoline prices. 

Tags Brian Deese Collusion Federal Trade Commission gas prices Lina Khan oil industry

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