From DailyCaller.com…
The Federal Reserve Bank of Dallas rebutted a popular claim from Democrats that fuel prices are surging as a result of price gouging by oil companies.
Alleged price gouging from Big Oil companies is not among the number of factors causing record high gasoline prices nationwide, senior Dallas Fed economists Garrett Golding and Lutz Kilian wrote in a blog post Tuesday. While it is true crude oil prices have declined at various points over the last several months while fuel prices remained high, gasoline costs aren’t often set by oil drillers and are affected by other expenses like rent and credit card fees, they argued.
“Gas station operators set retail prices based on their expected acquisition cost for the next delivery of fuel from the local distributor, federal and state tax rates, and a markup that covers operating expenses, such as rent, delivery charges and credit card fees,” the Fed officials wrote.
“Since only 1 percent of service stations in the U.S. are owned by companies that also produce oil, U.S. oil producers are in no position to control retail gasoline prices,” they continued.
Democrats, though, have repeatedly blamed Big Oil for the high gasoline prices, arguingthat the companies are exploiting the Ukraine crisis to pad their profits. House Speaker Nancy Pelosi said Thursday that the House would vote next week on the Consumer Fuel Price Gouging Prevention Act introduced by Democratic Reps. Kim Schrier and Katie Porter on May 6.
“While families are struggling to pay higher prices at the pump, oil and gas companies are recording record profits,” Pelosi told reporters.
