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U.S. Governors Warn Against Price Gouging As Shortages Due To Leak Continue

tank farm

Georgia Governor Nathan Deal signed an executive order against unjust price hikes after gasoline prices spiked 20-40 cents across the state following a pipeline leak in Helena, Alabama.

The order emphasizes the terms of an existing law that forbids gouging during “a state of emergency” by permitting price changes only as a reaction to the higher cost of fuel or fuel transportation.

An increased demand for gasoline—as is the status quo in Alabama, Georgia, Tennessee and the Carolinas after a 252,000-gallon leak in Colonial Pipeline Company’s line last week—is not considered a valid reason to raise prices under the law.

Last week, GasBuddy reported that the average price of a regular gallon of gas in Georgia stood at $2.17. The same site said the state’s average gallon price today is $2.35.

Citizens in affected states have been encouraged to report unusually high prices to the relevant authorities, which, coupled with the Governor’s announcement, has likely prompted prices to self-correct under the weight of the law.

The Governor of North Carolina approved a similar executive order in the wake of the September 9th detected leak and the supply shortages it has caused since.

"Based on our ongoing updates from Colonial, the construction of a bypass pipeline is moving forward which will soon allow fuel supply operations to return to normal," said Governor Pat McCrory. "In the meantime, my executive orders remain in effect to protect motorists from excessive gas prices and minimize any interruptions in the supply of fuel."

Colonial now says the new bypass line will be in operation by the end of next week, after it received the necessary approvals from federal regulators to begin construction. Initially, the Georgia-based firm did not provide a timeline for the process.

Washington D.C. and eleven states located on the leaked pipeline’s route have received waivers from the Environmental Protection Agency to sell gasoline formulations banned under the Clean Air Act in order to alleviate the affects of the ongoing shortage.

By Zainab Calcuttawala for Oilprice.com

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  • randy verret on September 20 2016 said:
    Thank goodness a native burial ground was not involved on that Colonial bypass!
  • Joe on September 20 2016 said:
    Other press sources report the leak as 250,000 gallons, not 250,000 barrels. Looks like a simple typo on the part of the author. Still a lot, but 42 times less. American consumers take it for granted when they gas up. There is a tremendous amount of infrastructure required to keep the system going. No one likes a pipeline leak but fortunately they are rare considering the amount that gets delivered every day.

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