Tuesday, June 09, 2009

Price Collusion in Louisville

I live in Louisville, KY. I drive a lot of miles for my job. I often drive 500 miles a week. Mostly I stay within Jefferson County, but sometimes I drive to neighboring counties. I know for a fact that there is price fixing at the gas stations, and I can usually even predict which day of the week prices will go up. I suspect prices will go up today, but I haven't been out on the roads yet.

It's one thing for gas stations to be competing and matching each other's prices. Yet, when every single gas station in the county goes up exactly 15-30 cents within 24 hours, something fishy is going on. The news stations investigated for over a year, the governor even came for several weeks to try to investigate (that period was actually the longest time frame that the gas stations did not increase their prices).

I know what the market price should be, because I only have to drive a few miles out of town to the Simponsville exit on I-64, just outside of Jefferson County. Shelby County apparently does not participate in price fixing. However, other suburbs, such as LaGrange and Prospect, do participate. I'm really just posting this information in case the governor needs some factual information, since he never experienced the results of price collusion.

It's one of those things that just gets more and more frustrating as bad as the economy is getting. However, apparently there is nothing anyone can do about it, it's just the result of an oligopoly. I try to time my visit to the pump as best I can, but since I fill up twice a week usually, it can be awfully difficult to avoid.
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