IG Madigan and Emanuel Demand Answers for Recent Gas Spike

Attorney General Lisa Madigan and Mayor Rahm Emanuel are demanding answers from the Illinois Petroleum Council and its member companies about the dramatic spike in gas prices.

Gas prices began to soar after BP claimed that a breakdown at its Whiting, IN refinery has reduced production, sending Chicago-area gas prices soaring.

BP has stated that gas prices will start to lower when the repair is completed, but the company still has not said how long those repairs will take place. Both elected officials state that the so-called breakdown at Whiting, IN refinery “does not explain the entirety of the spike in local gas prices.”

IG Madigan and Mayor Emanuel sent a joint letter to the petroleum council and its member oil companies on Monday demanding an explanation.

The spike has prompted some to question whether gas station owners are taking advantage of situation by gouging customers.

“We understand that many factors affect the price for a gallon of gasoline, and we are aware of the unplanned outage at the BP refinery in Whiting, Indiana,” Madigan and Emanuel wrote. “However, it is widely known that crude oil prices have been at all-time lows for quite some time.”

The attorney general and mayor then ask the petroleum council to answer the following questions “to help us understand this gasoline price spike.”

1. What are all the factors that caused and are causing gasoline prices in Illinois to increase?
2. When are Illinois gasoline prices expected to decrease?
3. What factors will facilitate and/or expedite the price decrease process?
4. What can be done to prevent future gasoline price spikes under similar circumstances’?

The Illinois Petroleum Council was given until September 8 to respond.

“Gasoline is not an optional purchase for many hard-working Illinois residents, and paying more for gas means less money to spend on other essentials like rent, groceries and medicine,” Madigan said in a written statement. “Unfortunately, every time gas prices rise, the oil companies give us excuses. The oil companies need better contingency plans because drivers deserve answers and relief from these outrageous prices.”

Chicago-area motorists began to see gas prices rise quickly almost immediately following the outage at BP’s refinery. A gallon of regular gas in the Chicago metro area cost an average of $3.46, up 70 cents from August 8, when BP announced it was shutting down one of its crude distillation units, according to AAA’s Daily Fuel Gauge Report.

At the same time, the report stated that the current national average for gas was $2.66 -- the lowest in six years. As of Monday, the lowest gas price listed in Chicago is $2.93, according to Chicago Gas Buddy.

“Rising oil prices mean a rising cost of living for Chicagoland residents,” the mayor said. “It’s time for the highly profitable oil companies to stop playing games with the wallets of Chicagoans and to stabilize prices at the low levels seen throughout the United States.”

A copy of their joint letter is attached.

Madigan-Emanuel Joint Fuel Letter