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Author Topic: Klobuchar, Grassley call for antitrust investigation of Big Oil Back to Topics
gamechanger2011

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Message Posted: Aug 21, 2013 4:36:12 PM

"Sens. Amy Klobuchar, D-Minn., and Chuck Grassley, R-Iowa, have issued a letter to the U.S. Department of Justice and Federal Trade Commission asking for an investigation of anticompetitive practices by oil companies that limit consumer access to renewable fuels, specifically higher ethanol blends.

In the letter addressed to Attorney General Eric Holder and FTC Chairwoman Edith Ramirez, Grassley and Klobuchar express concern that oil companies are engaging in anticompetitive practices with the goal of blocking consumer access to renewable fuels. They urge the DOJ and FTC to open an investigation into the allegations, and determine if antitrust laws have been violated. “Faced with growing competition from new sources of fuel promoted by the [renewable fuel standard (RFS)], the oil industry has publicly stated their goal of repealing the RFS,” Grassley and Klobuchar write in the letter. “At the same time we have heard reports that oil companies are taking steps to undermine efforts to distribute renewable fuels that could help meet the RFS requirement.”

Within the letter, the senators point to allegations that the oil industry has mandated retailers to carry and sell premium gasoline, an action that would require station owners that want to sell biofuels to bear the cost and logistical burdens to install additional infrastructure. Klobuchar and Grassley also highlight allegations that at least one oil company has used franchise agreements to prevent its franchisees from selling higher level ethanol blends.

“By forcing a franchisee to carry premium gasoline as a condition of carrying regular gas, the oil company may be using its economic power over its franchisee to effect a tying arrangement in violation of the Sherman Act,” Grassley and Klobuchar continued in the letter. “This conduct may also violate the Gasohol Competition Act of 1980, which prohibits discrimination or unreasonable limits against the sale of gasohol or other synthetic motor fuels.”
Klobuchar, Grassley call for antitrust investigation of Big Oil
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gamechanger2011
Champion Author Wichita

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Message Posted: Sep 16, 2013 8:36:40 PM

Lologogo...
"Does the renewable fuels refernce in this article include fuels made from grasses, mosses, seaweed & animal waste?"Renewable fuels refers to any fuel that is renewable. That means corn, cellulosic, waste, etc. Fossil fuels are not renewable, they are finite.

[Edited by: gamechanger2011 at 9/16/2013 8:38:00 PM EST]
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Lologogo
Champion Author Twin Cities

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Message Posted: Sep 13, 2013 4:43:47 PM

Does the renewable fuels refernce in this article include fuels made from grasses, mosses, seaweed & animal waste?
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Chazzer
Champion Author Nevada

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Message Posted: Sep 10, 2013 12:18:32 PM

Again ... haven't we learned our lesson yet?
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Shockjock1961
Champion Author Illinois

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Message Posted: Aug 31, 2013 10:01:52 AM

"maybe we should investigate big corn"

Perhaps we should be investigating collusion between the government and ethanol producers. Did you know the government is using taxpayer dollars to buy sugar and then they turn around and sell it to the ethanol producers for 23 cents on the dollar?
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jay93LA
Champion Author New Orleans

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Message Posted: Aug 31, 2013 8:30:18 AM

maybe we should investigate big corn
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Sneakers55
Champion Author Houston

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Message Posted: Aug 23, 2013 9:24:20 AM

Grassley and Klobuchar are the finest Senators that Big Ethanol money could buy.
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SoylentGrain
Champion Author Illinois

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Message Posted: Aug 23, 2013 8:17:27 AM

".ya REALLY think the oil industry would practice business unethically? "

What's unethical about requiring certain products be sold under a contract between a dealer and supplier? Nothing wrong with that.

Just remember, when the EPA and justice department get involved in selecting the products you use, it gets expensive. Ethanol is a superior product to conventional gasoline. A free market can sort that out. It will just take time. But, get the bureaucrats out of our lives and the cost of living decreases dramatically.
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brerrabbitTX
Champion Author Houston

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Message Posted: Aug 22, 2013 9:47:32 PM

“By forcing a franchisee to carry premium gasoline as a condition of carrying regular gas, the oil company may be using its economic power over its franchisee to effect a tying arrangement in violation of the Sherman Act,”

Okay so the big bad oil company signed up a retailer to be a branded site. The oil company said that the deal was this, the retailer gets $100,000 per site up front in return for signing an agreement to sell that brand of fuel. If the retailer stays with the contract for the full seven year term the up front money is basically a forgivable loan. For the past 75 years standard language in those contracts have been that the retailer must offer three differentiated fuels, spelled out as regular, mid grade and premium. Now all of a sudden that contract, the same form that has been used for 75 years is the new scheme of big oil to prevent the sale of ethanol blended fuel.

Wrong! Additionally the PMPA was amended several years ago to say that any retailer in the nation can sell high ethanol blends from under the canopy at his sites. Big oil cannot stop him. They can ask the courts to enforce existing contracts but they cannot stop the retailer from selling high blend ethanol. The catch is the retailer has to pay for the tank and the dispenser for the high blend ethanol and they don't want to because the vast majority of them know they will not make their investment back with high ethanol blend sales. In other words the ethanol advocates of the world want dealers to be lawfully allowed to break contracts to sell a fuel that the dealers won't invest their own money to sell.

O yeah this all warrents huge expenditures of taxpayers money to uncover anti trust violations. What it seems like to me is the ethanol supporters wanting someone else to provide the facilities for ethanol to grow without having to pay for them. The statement about the use of sub octane gasoline in order to control the ethanol distribution is another walk in fantasy land. Since you have to blend 10% ethanol into everything(or almost everything) sold why not use the benefit of the 10% ethanol to increase octane. hat's just common sense, not a plot to control distribution of ethanol. The RFS the thing that ethanol supporters hang their hopes and dreams on is the very thing that requires the participants in the fuels industry to buy and blend ethanol. So because they are required to do it and do it, it is according to Ron Lamberty a plot by big oil to control ethanol price and distribution.

Honestly his thought process makes absolutely no sense at all. Big oil is evil and controlling because they are blending ethanol into fuel because the RFS requires it. Following the law makes them evil and controlling?
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Hannie59
All-Star Author Appleton

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Message Posted: Aug 22, 2013 5:44:44 PM

Thanks for posting gamechanger. Gee whiz golly....ya REALLY think the oil industry would practice business unethically? WAKE UP AMERICA! Let the market decide???? What a crock. Had the market REALLY been at work gasoline would not have their current disgusting monopoly.

Release from ACE:

Sioux Falls, SD (August 20, 2013) – Ron Lamberty, Senior Vice President for the American Coalition for Ethanol (ACE),issued the following statement on the calls from Senators Amy Klobuchar (D-MN) and Charles Grassley (R-IA) to have the Justice Department and the Federal Trade Commission investigate alleged anti-competitive practices by oil
companies for potentially blocking market access for renewable fuels like ethanol. “ACE members thank Senators Grassley and Klobuchar for standing up to Big Oil and investigating this marketrestricting behavior on the part of the oil companies. The RFS will only be unworkable if Congress allows Big Oil to make it appear unworkable. If we had more lawmakers like Senators Grassley and Klobuchar, maybe Big Oil’s attacks wouldn’t be taken so seriously in Washington.
As a fuel station owner, every time I hear some Big Oil mouthpiece saying we should “let the market decide” how much ethanol is used, I think of these kinds of restrictions the oil companies have been jamming down station owners’ throats for decades, making sure only one decision is possible - oil.
Senators Grassley and Klobuchar are right. This year alone, Big Oil has spent millions on ads to convince consumers and Congress that they don’t want E15 or other ethanol blends that they’ve never been allowed to try, and to make that distortion appear real, oil companies have done everything they can to make sure station owners are never allowed to sell the fuel, and consumers are never allowed to buy it.
Oil companies have even gone to the extent of using their control of the pipeline system to make a lower-octanesubstandard fuel the main fuel used in the country, precisely because that fuel allows them to control the distribution and cost of ethanol. We encourage the Department of Justice and FTC to commence this investigation immediately.”



[Edited by: Hannie59 at 8/22/2013 5:47:40 PM EST]
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