Lockyer Accuses Oil Firms of Cartel Action

California Atty. Gen. Bill Lockyer said that the five major oil companies operating in the state act like a cartel because they control more than 90% of the market. Lockyer made the remarks after opening the final meeting of his gasoline price task force, which heard economist reports disputing Lockyer’s contention. One report found that the state’s gasoline market is acting like any commodity market in which prices rise when supplies are low. Gasoline prices in California and around the nation have risen to record levels during the last several weeks, which analysts have blamed on higher oil prices and extremely low gasoline inventories. Lockyer has faulted oil companies for making what he called “excess profits” on gasoline. The task force--composed of members representing the oil industry, gasoline stations, environmentalists, consumer groups, academia and government--has been examining such issues as how to increase competition within the state and whether a strategic gasoline reserve or a products pipeline into the state would reduce price volatility. The task force is expected to report to the Legislature in about a month.