Kentucky attorney general alleges gas price gouging

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FRANKFORT, KY (WAVE) - If you think you're getting gouged at the pump, you just got some very high profile support. On May 13, Kentucky Attorney General Jack Conway filed a motion in state court, accusing the major gasoline supplier in the Bluegrass of price gouging.

The attorney general says Marathon Oil illegally raised gas prices by $.30.

"They're killing you," said driver Bob Breischaft.

He knows what it's like to be at the mercy of a gas guzzler, saying it takes $150 to fill up his truck.

"I've got a 34 gallon tank on this," Breischaft said.

The visitor from Pennsylvania was glad to hear about Kentucky's attorney general taking action.

"Big oil companies have lots of lawyers and they're going to fight us, but the Commonwealth of Kentucky has one lawyer and that's Jack Conway and he is going to pursue this on behalf of consumers," said AG's spokeswoman Allison Martin.

Friday, Conway's office asked for a temporary injunction against wholesale gasoline supplier Marathon Oil, accusing the company of price gouging or raising prices during a state of emergency for something other than Marathon's costs.

"We believe that that price may have been based on something else, such as future markets, things like that," Martin said. "They can do that, but not during a declared state of emergency when the price gouging statute has been triggered."

The AG's office wants a judge to force Marathon to reset its gas prices to what they were the day before Kentucky went into its flooding state of emergency - $3.25 per gallon.

"You know, it may be a matter of cents, really," Martin said, "but when you're talking about 4 million people in the Commonwealth of Kentucky who are paying two or three cents more a gallon, that's a lot of money."

Martin adds that Conway's office believes the gouging is solely on the part of the wholesale supplier, Marathon Oil, and not of retailers, or the gas stations themselves.

Louisville businessman Jeff Banks is just glad to see someone doing something.

"I feel it was totally uncalled for," Banks said of the hike. "I can't see a justification ... I think there needs to be some accountability between the oil people and what consumers pay for gas."

Martin says even if the state proves its case and can collect damages from Marathon, you're likely not getting any money back in your wallet. She says in the past, money collected has gone to the general fund.

The Attorney General's office will make its argument to a judge Monday morning.

The office also announced Friday it has finished its investigation into claims Marathon has an unfair competitive advantage here.

It started back in the summer of 2008 when Conway's office launched an investigation into whether Marathon took over too much of the Louisville market's supply when it took over Ashland Oil in 1996.

"We believe we found evidence that the wholesale price of gasoline was more expensive in the Louisville market because there was a lack of competition," Martin said.

Martin says that anti-trust investigation is going to the U.S. Department of Justice and she believes the DOJ will be very interested in the case. According to Martin, the investigation found Louisville's gas prices are higher than other cities in the Midwest that use the same gas blend but have more competition, like Chicago and St. Louis.

Marathon Oil didn't return calls from WAVE 3.