California's record-breaking rise in gasoline prices over the last week was so sudden, and so apparently unjustified by the supply-and-demand factors that usually control markets, that it's natural to suspect some kind of conspiracy at play. Among the suspicious is Sen. Dianne Feinstein (D-Calif.), who sent a letter to the chairman of the Federal Trade Commission on Monday calling for an investigation.
Meanwhile, regardless of the spike's cause, Gov. Jerry Brown moved swiftly Sunday to implement a solution, asking state environmental regulators to allow early sales of California's winter-blend gasoline formula, which is cheaper but potentially more environmentally unfriendly than the summer blend. That was probably the right thing to do to help stave off serious economic harm. But in light of the conspiracy allegations and other factors, it also sets a worrisome precedent.
Are Californians the victims of market manipulation? That has been asked many times after sudden hikes in gas prices, but probes have turned up little or no evidence that companies intentionally restricted supplies. Because there are relatively few refineries that produce California's gasoline, which is cleaner but more expensive than blends sold nationwide, a slowdown here or there can have a dramatic impact on prices. The recent pain at the pump can be explained away as the result of an August fire that closed a big Chevron refinery in Richmond, a pipeline disruption and a power outage that temporarily shut down an Exxon Mobil refinery in Torrance.