When Oil Markets Surge, So Does the Temptation to Cheat

When crude oil prices jump around, there's always a temptation. For oil companies, it's simple: use the chaos as cover. Slip a call to a competitor. Quietly coordinate prices at the pump. Blame it on "market volatility." Who'll know?

This week, the Justice Department and Federal Trade Commission sent a clear message: we're watching. In a letter reviewed by CBS News, they told state attorneys general that "business may not use market volatility as cover for anticompetitive practices, fraud, or any other lawlessness that harms Americans."

It sounds straightforward. But here's the problem: it's reactive, not preventative. We're monitoring. We're urging. We're ready to prosecute if we catch you. That's better than nothing, but it's not real competition policy. It's triage.

Why This Matters Right Now

Gas prices aren't just a number on a sign. They're your budget. They're whether your kid gets to school, whether you can afford to get to work, whether a family driving to see relatives goes into debt. When companies collude to keep prices high during moments of uncertainty, they're not just padding their margins. They're making calculated bets that regulators won't catch them in time.

The letter also noted something revealing: the federal government has no enforcement power over simple price-gouging. None. Price-gouging, charging unreasonable prices during emergencies or disruption, is illegal in many states. But at the federal level? The government can only prosecute collusion (two or more companies agreeing to raise prices together), not a single company deciding to squeeze consumers because it can.

That's a massive gap. A company alone can gouge. A company with a competitor's handshake can't. But proving that handshake happened requires investigation, time, and resources that are stretched thin.

What Real Competition Looks Like

The Common Good Party believes that competition requires rules, and that rules only work when they have teeth. Right now, oil companies know that enforcement is slow, expensive, and uncertain. That's not a deterrent. That's the cost of doing business.

Real competition policy means:

Adequate funding for investigation. The FTC and Justice Department can't monitor what they can't afford to investigate. Both agencies have been understaffed relative to the size of American markets for decades.

Speed. By the time a case closes, the damage is done and the money is in the bank. We need authority to impose rapid, meaningful penalties during investigations, not just at trial.

Prevention, not just prosecution. Breaking up companies that are too big to compete fairly. Blocking mergers that reduce competition before they happen. Making it clear that collusion isn't worth the risk.

Transparency about what "market volatility" really means. When oil companies invoke it, they're often talking about normal market conditions, not emergencies. We need clear rules about when price adjustments are reasonable and when they're price-gouging hiding under a different name.

The letter is a good sign, it shows this administration is paying attention. But it's a warning, not a solution. We can do better.