Biden Warns Oil Majors Not to ‘Gouge’ Prices in Ian’s Wake

However, most Americans buy gasoline from small operators, while prices are mainly determined by market forces.

September 30, 2022

ALEXANDRIA, Va.—Hurricane Ian slammed into Florida’s Gulf Coast as a strong category 4 storm on Wednesday, and President Biden warned gas and oil companies that his administration won’t tolerate gas-price “gouging,” reports the New York Post.

“I want to add one more warning, a warning to the oil and gas industry executives: Do not—let me repeat, do not—do not use this as an excuse to raise gasoline prices or gouge the American people,” Biden said on Wednesday during a nutrition-focused event in Washington.

He said that the hurricane may disrupt domestic oil production only “for a very short period of time.”

“This small temporary storm impact on oil production provides no excuse, no excuse for price increases at the pump. None,” the president said. “If gas companies try to use this storm to raise prices at the pump, I will ask officials will look into whether price-gouging is going on. Americans are watching, and the industry should do the right thing.”

According to NACS research, most Americans buy gas from small operators, not big-name energy companies. Of the more than 116,000 locations that sell gas nationwide, 54.6% are run by one-store operators. In Florida, 4,032 of the 7,349 locations selling gas have one-store operators.

“Right now, station owners are focused on having an adequate supply for everyone in a very difficult situation,” Jeff Lenard, NACS vice president of strategic industry initiatives, told The Post. “They are focused on serving their customers and not pointing fingers.”

Bloomberg reports that many Florida gas stations that were hit hard by Hurricane Ian are closed, and others that were near Ian’s path may see a disruption in fuel supply due to loss of power and road closures.

As much as 26% of Tampa’s gas stations were without fuel Thursday, said Patrick De Haan, head of petroleum analysis at GasBuddy. In Gainesville, Fort Myers and Naples, the figures were 17-18%, De Haan said in a tweet. Statewide, close to 11% of gas stations were without fuel.

All of the stations between Fort Myers and Naples were closed, said Ned Bowman, executive director of the Florida Fuel Marketers Association, in an interview with Bloomberg.

“Power is the main issue related to infrastructure, as opposed to damage” to gas stations, Lenard told Bloomberg.

Bowman said the association is working to provide generators to gas stations without power.

Fuel Logic is working to bring trucks and fuel from out of state but said most of its fleet is grounded in southern Florida. The supplier said it had to ration diesel sales before the storm hit, according to Fuel Logic president Eliot Vancil. “We are definitely short,” he said.

Part of the port of Tampa Bay reopened Thursday morning. Bloomberg vessel tracking showed the vessels Lone Star State and American Phoenix were underway to deliver fuel from Louisiana to Tampa.

“In an unfolding weather event, our industry is focused on keeping the energy market well-supplied and delivering fuels where they are needed most while ensuring the safety of our workforce,” the American Petroleum Institute said in a statement. “Gasoline prices are determined by market forces—not individual companies—and claims that the price at the pump is anything but a function of supply and demand are false.”

This isn’t the first time that Biden has criticized oil companies and gas stations in relation to gasoline prices. Last week he told “the companies running gas stations and setting those prices at the pump” to “bring down prices at the pump to reflect the price you’re paying for the product. Do it now,” Fox Business reported.

Read this Convenience Corner blog post “Do Oil Companies Make Money on High Gas Prices?” to see the difference between oil prices and prices at the pump.

And for gas station operators in particular, this NACS Daily article is spot on: “How to Talk to Customers, Reporters About Gas Prices.”

To keep up with the latest fuels news, including updates from the U.S. Energy Information Agency, look to Fuels Market News, published by NACS Media, and subscribe to its weekly e-newsletter.