Lawmakers Clamor for Gas Price Probe

Gas prices have shot up more than 40 cents since the beginning of the year.

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Record-high gas prices this winter have put increasing pressure on household budgets during a time when trips to the gas station are typically cheaper.

But it's not just budget-strapped consumers lamenting unseasonably expensive fuel—lawmakers too are pressing for a closer look at what's causing surging prices at the pump.

On Monday Senate Energy and Natural Resources Committee Chairman Ron Wyden (D-Ore.) sent a letter to the Energy Information Administration, asking for more information about domestic oil production, exports and imports, refining operations, and any other factors that could be contributing to the uptick in gas prices.

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"American families and businesses have been paying record-high gasoline prices at the pump even as domestic oil production recently hit its highest level in more than two decades," Wyden wrote EIA Director Adam Sieminski. "For many Americans, there appears to be a fundamental disconnect between these facts, especially when many families are also using less gasoline thanks to more efficient cars and trucks."

Wyden—who recently said spikes in fuel costs have "no reasonable explanation"—requested the information ahead of an anticipated committee hearing to address the causes for high fuel prices, even while domestic oil production has surged.

EIA spokesman Jonathan Cogan said the agency is currently working with the Senate committee to respond to Wyden's request. He didn't have a timetable on when the report would be completed. Senate Energy and Resources Committee press secretary Keith Chu said no further arrangements had been made regarding potential witnesses for the hearing, or even scheduling the hearing itself.

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Average gasoline prices nationwide have risen more than 40 cents since the beginning of the year according to government data. As of Tuesday, they are on average around $3.70 a gallon, according to the most recent AAA Fuel Gauge. The EIA expects gas prices to average about $3.55 per gallon in 2013.

Recent price fluctuations can be explained by the transition from winter blend gasoline to summer blend gasoline, a process that constrains supply and drives up prices at the pump temporarily.

But the larger issue is overall refinery transparency, according to Gregg Laskoski, senior petroleum analyst at gas price comparison site GasBuddy.com, who adds that many times fuel markets are blind sided by issues at refineries that cause supply constraints.

"Very often there is minimal information made available about issues at refineries," Laskoski says. "By the time that's made available, and by the time anybody is aware of any issues, it's too late."

It's also difficult to pinpoint the source of the problems at refineries, Laskoski says. While the most recent surge in prices at the pump has been credited to the seasonal transition between fuel blends, last fall a slew of "maintenance" issues wreaked havoc on gasoline prices on the West Coast and in parts of the Midwest, exposing how immediately vulnerable consumers are to changes in refinery capacity.

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A key to solving that problem is increasing pipeline capacity to allow easier and more efficient transport of resources to demand centers. High crude oil prices shipped in from abroad have led to several refinery closures on the East Coast, which has constrained supply and driven fuel prices higher.

"We need to look at more pipeline projects that can bring fuel from the center of the country such as Cushing [Okla.] and from the Gulf Coast regions to the coastal regions," Laskoski says. "You don't just need the Keystone running North to South, we need similar projects that bring lower costs fuels to the coasts."

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