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Oil prices raise antitrust question

May 29, 2008

Re "Exxon's reach is felt at its stations," May 25

The story about how Exxon Mobil sets its wholesale prices and limits the profits of its franchises did make me feel a little bad for the station owners. But it reminded me that the major oil companies are likely violating U.S. antitrust laws.

The article points out that major integrated U.S. oil companies "produce crude oil, own refineries and sell gasoline." This sounds very similar to the movie industry in the 1940s, which the U.S. Supreme Court found was breaking antitrust laws.

Today's oil companies apparently have so much price control over their dealers, and their prices rise and fall in such cohesion, that it is difficult to see the U.S. oil industry as anything more than a price-fixing cartel, an oligopoly that is dangerous to this nation's economy and its national security.

Howard Schlossberg

Woodland Hills

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