Arizona representatives help move gas price-gouging measure forward

May 23, 2007

by Mike Sunnucks

The Business Journal of Phoenix

Arizona’s four Democratic congressional members — including freshmen Gabrielle Giffords and Harry Mitchell — and Flagstaff Republican Congressman Rick Renzi voted Wednesday for a new federal price-gouging law aimed at oil companies and gas stations caught gouging consumers with higher prices.

The federal measure makes price gouging illegal and allows the Federal Trade Commission to go after oil companies and service stations that charge excessive prices for gasoline. The gouging law would go into effect if the president declares an emergency situation. The aim is to give the FTC more teeth to go after oil companies and the energy sector.

Phoenix-area Republican Congressmen Trent Franks, Jeff Flake and John Shadegg voted against the measure, which was approved and now moves to the U.S. Senate. Critics worry too many federal regulations will amount to price controls, which could have negative impacts on supply.

But oil supplies have already been a major cause of gas price spikes, with U.S. refineries operating on razor-thin supply margins.

The bill’s progress comes as gasoline prices soar above $3 per gallon and oil companies report multi-billion dollar profits. Exxon Mobil Corp. (NYSE: XOM) posted a $40 billion profit last year. BP (NYSE: BP) had a $21 billion profit.

AAA reports that national gas prices Wednesday hit $3.22 per gallon of self-serve unleaded regular. Arizona’s statewide gas price is $3.11 per gallon.

Democratic congressional leaders are looking to do something about rising gasoline prices and have hit Republicans and the Bush administration for being too cozy and friendly with the energy sector.

Most of the energy sector’s campaign contributions go to Republicans, though Renzi has been one of the few Republicans in Washington D.C. to go after oil companies over price spikes.

Democratic U.S. Reps. Raul Grijalva of Tucson, Ed Pastor of Phoenix joined Mitchell and Giffords in voting for the price-gouging bill.

Mitchell represents Tempe and Scottsdale. Giffords’ district includes Tucson and Tombstone.

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