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Attorney General Jack Conway pledges to take action against Marathon over gas prices

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Kentucky Attorney General Jack Conway Kentucky Attorney General Jack Conway
LOUISVILLE, Ky. (WDRB) -- Kentucky attorney general Jack Conway says he's taking a new stand against Marathon, over our region's gas prices.

It's been Jack Conway's battle cry for years that Marathon Petroleum has a stranglehold on our region's gas market, as the chief supplier to area retailers. The situation has existed since 1998, when Marathon merged with Ashland Oil. Conway claims the investigation he launched several years ago has turned-up proof that local gas customers are paying more because of it.

"We have expert witnesses who have analyzed all of the data for us, that have looked at Marathon's position in this market, looked at how they supply their retailers and are of the opinion that Marathon is able to manipulate prices -- depending on what time of year it is -- anywhere from a nickel to a quarter per gallon.," Conway said during an in-studio interview with WDRB.

I had the New Jersey-based Oil Price Information Service, or OPIS, give me wholesale gas prices for Louisville and five other markets: Boston, Richmond, Chicago, Cincinnati and St. Louis. They all have competition in wholesale suppliers. I randomly picked eight dates over the last three years and compared prices of gas. On each of those dates, Louisville was right in the ballpark with everyone else -- never the highest, never the lowest. In other words, at least recently, it doesn't appear Marathon has been taking advantage of its position.

The Federal Trade Commission has turned a deaf ear to Conway's arguments.

"Basically, I've given up on the [Federal Trade Commission]," Conway said. "About six or nine months ago, I gave up on the FTC and decided that we had to do something as a state, and we've been researching what the most appropriate action is to take. So I've given up on the Federal Justice Department, I've given up on the FTC, I've given up on this particular administration doing something about this problem."

So Conway says he's going to announce new action next week. He'll only say it will deal with Marathon's wholesale pricing of gasoline and how it, in his words, has gas retailers over a barrel. But the fact this new move comes as Conway is eyeing the Kentucky's highest office may spark suspicions.

"No...It's not," Conway said when asked if the move is just a campaign stunt. "Because I've been talking about this for seven years. About six to nine months ago...I said we're going to have to take some action. So it's taken some time to put that together. But the answer is no, it's not political."

One local gas retailer says it doesn't think Marathon's prices are out of line with other markets, and says it told Conway that when he asked.

When I asked Jack what more he can do about Marathon as attorney general, he said, we'll all find out next week.

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