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Local Businesses Under Investigation for Price Gouging Complaints Save Email Print
Posted: 6:20 PM Sep 25, 2008
 Last Updated: 11:00 PM Sep 25, 2008
 Reporter: Kristen Ross
Email Address: ross@kbtx.com
55 comments
A | A | A

Is the pain at the pump worse in the Brazos Valley than elsewhere across the state? It's a question you our viewers answered a resounding yes to-- just last month.

Thursday morning, according to the Texas Gas Prices website, College Station had among the highest reported gas prices in the state, coming in at $3.89 a gallon.

News 3 has just learned there are multiple gas stations and other businesses being investigated by the Attorney General's Office. Thirteen to be exact, all coming from price gouging complaints some of you have filed with the Attorney General's Office.

Places in Bryan, College Station, Madisonville and Franklin are under investigation.

We first contacted the AG's office last month after many of you at home began noticing gas prices here in B/CS and surrounding communities as higher than those in nearby Houston and even Dallas.

Since the AG's investigation is ongoing, details about the specifics, such as what stations or businesses are under a watchful eye, are not being released and neither are the dates that those complaints were filed.

So it's unclear if they came in before or after Hurricane Ike, for which the AG's office is currently looking into more than 900 complaints of price gouging.

Many of you at home have had concerns about whether gas prices here rise when college students return to town.
But is that price gouging? Ultimately it will be up to the AG to decide.

News 3 has filed an open records request with the Attorney General's Office to get our viewers more information.

We've also asked officials with Valero's Corporate Office in San Antonio why prices in the Brazos Valley may be so much higher.

Here's what they said:
-In smaller communities, stations aren't as big, and therefore don't buy in volume.
-Prices can vary depending on real estate in the area.
-Pollution standards can make a difference, such as buying gasoline with ethanol can make prices lower versus buying gasoline without ethanol.
-And, of course, natural disasters such as a Hurricane can drive the prices up.

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Posted by: Anonymous Location: Iola on Oct 1, 2008 at 12:37 PM
I was in San Antonio this past Saturday and bought gas at a Shell station for $3.49 a gallon. The Shell station on University Dr. directly across from TAMU is selling it for $3.79 a gallon. This is ridiculous!
Posted by: Domaco38 Location: bcs on Oct 1, 2008 at 08:44 AM
Just a note. I work in the automotive service industry and will tell you that the non name brand fuels are not what you want to put into your autos. The places like walmart, sams, H.E.B........, not only is it cheap, bad gas, those places do not maintain the in ground fuel tanks like the big names do. You will get dirt and debris, and worse, water. These will then get pumped into your car and cost you alot of money in the future. You will have to spend money to clean out your fuel injection system sooner then you should, or, and I have seen it more times then I can count, you will have to get your car towed to a service facility because the water in your tank has caused the electric, in tank fuel pump to short out and go bad. Very costly and something that should not happen. I understand it might be easy to be able to fill up after you get your groceries but, might get a bit frustrating soon after. People, do not waste your money. Better fuel milage, less repair costs. No brainer to me.
Posted by: Gas watcher on Sep 30, 2008 at 04:29 PM
"the "big name" fuel distributors are a small bunch, and very likely willing to protect their margins." Which is what I said; the money is going to the DISTRIBUTORS or possibly the COMPANIES running the Hearne terminal, not the stations (except for the stations owned by the distributors and oil companies). And as for the variation by brand, I've run that route 5 days a week forever, and I don't bother to monitor when there's a strong head or tail wind, and discard the runs where I've got to drop off the cruise control. But when I get 8 of 10 Kroger runs at 17.9 or 18.0 while 9 of 10 Shell runs are 18.4 or 18.5 and all 10 of the Exxon runs are 3 18.5 and 7 18.6, the standard deviation is pretty small. The AC and temp variations are inconclusive (so I'm OCD; I've recorded every fillup and mileage since 2001... although the gage lets me do a whole new level of detail). And before you hammer me for driving a truck, find me a hybrid that will pull a 4 horse and I'll trade tomorrow...
Posted by: For Gas Watcher on Sep 30, 2008 at 10:24 AM
No need for secret handshakes or midnight meetings; the "big name" fuel distributors are a small bunch, and very likely willing to protect their margins. And I'll assume your theoretical numbers on sales and margins are just that. Does a OBDII unit monitor wind speed and direction? Merging traffic? Any margin of error? 1% and 3% variations by brand; gimme a break. Take a statistics course....
Posted by: To Jan on Sep 30, 2008 at 08:57 AM
"Is it just me or have you noticed the price of gas has dropped a whole lot since this was reported?" Sure I noticed at the station across the road from my office, it dropped about 8 cents after the story ran, but I also noticed that it had already fallen 10 cents off the Ike high BEFORE this was reported...
Posted by: To Greg on Sep 30, 2008 at 05:38 AM
[Local distributors control/operate most of the pumps at the convenience stores, so a bit of collusion amongst the distributors goes a long way for "fixing" retail pricing. ] Do they have secret handshakes and meetings at midnight and Masonic Lodges, etc? And I suppose they threaten or kill the ones who don't fall in line... Or maybe NOT ONE of the little mom and pops who are paying a $0.15 per gallon penalty are smart enough to see that cutting the price $0.30 and making $0.20 per gallon on 6000 gallons per week is a heck of lot better than making $0.35 on 2000 gallons per week. [ For Gas Watcher: a 3% change in mileage could hardly be tracked to a brand of gasoline. Way too many variables in the consumption of a tank of fuel to call that factual.] With an ODBII gage measuring trip mpg over a standard route under cruise control, it's very reproducible; my standard route is Greens Prairie to 21 were I work @ 65 mph. The gage also IDs Stations that short their pumps...
Posted by: Jan on Sep 29, 2008 at 07:56 PM
Is it just me or have you noticed the price of gas has dropped a whole lot since this was reported?
Posted by: dave Location: CS on Sep 29, 2008 at 07:41 PM
sorry Marc, but back in 02-03, when gas hit $3 for the first time in some parts of the country, they said the big truck-suburban crazy would dry up. Well, it's alive and well, and last I checked, you can still get a big V8 in your Chevy, Ford, or Dodge (and now even Toyota), and get 14 mpg. Trucks are part of the american way of life, and they ARE the Texan way of life, and if gas goes up to $8/gallon, then Texans will simply find out how to make a truck run on Bud Light. Oh, and more relevant to the topic, the small market thing IS bull, after Ike, gas prices in Wellborn were around 3.50-3.60...meanwhile I filled up my car at the shell on villa maria (in bryan), on my way to work, and paid 3.90 a gallon, because it was about the only place on my commute that didn't have a line that particular day.
Posted by: Greg Location: Bryan on Sep 29, 2008 at 02:01 PM
Local distributors control/operate most of the pumps at the convenience stores, so a bit of collusion amongst the distributors goes a long way for "fixing" retail pricing. Then the HEB's, Krogers', and Murphy's go just enough lower on price to draw great business, w/o being incriminated (while making a great margin). If local Shell/Exxon-Mobil/Texaco distributors are not in cahoots, I'll be shocked! For Gas Watcher: a 3% change in mileage could hardly be tracked to a brand of gasoline. Way too many variables in the consumption of a tank of fuel to call that factual.
Posted by: Anon Location: Cameron on Sep 29, 2008 at 01:46 PM
The small market reason is BULL. I was in Taylor last night and gas was from 3.34 to 3.49 at various places.
Posted by: Gas watcher on Sep 29, 2008 at 06:25 AM
"So if everyone agrees that Shell and Exxon are always higher than WalMart and HEB, why do people buy gas from Shell and Exxon?" Maybe because Wally world, HEB, and Kroger sell crappy gas? I get about 3% better gas mileage on Shell and Texaco than on any of the "sucker the customers in by selling at cost so they'll hit the store while they're in the parking lot" stations, and about 1% better than that on Exxon, so it's worth paying up to about 10 cents more per gallon to buy the good stuff.
Posted by: Who know's the facts Location: BRYAN on Sep 29, 2008 at 12:44 AM
I was informed by a source who works for Exxon (20 years) that there is enough oil stored in a salt dome in Millican Texas to last Texans for many many years. I also was told that there are salt domes all along the coast line holding crude oil. These oil depositories have reserves that could last Texas for upto 50 years worth of gas. Has anyone else heard this? ? ? ?
Posted by: Anonymous on Sep 28, 2008 at 07:11 PM
Lower gas prices are in Bryan. Just be safe.
Posted by: Jim Location: Bryan on Sep 28, 2008 at 11:08 AM
Hey MARC or more likely MARCI...........I drive my Hemi because it's cool and I dualed it out because the sound scares old people. When you start buying my gas I'll start worrying about what you think.
Posted by: gill Location: madison county on Sep 28, 2008 at 01:27 AM
Nothing will ever be done in Madison County as long as the good ole boys and the towel heads are able to run things. I live in Madison County and DO NOT shop there at all. Good luck to anyone who trust any business owner in Madison County.
Posted by: me Location: bryan on Sep 27, 2008 at 06:49 PM
So if everyone agrees that Shell and Exxon are always higher than WalMart and HEB, why do people buy gas from Shell and Exxon? If we stop buying from the most expensive places, won't they lower their prices?
Posted by: Anonymous Location: B/CS on Sep 27, 2008 at 06:45 PM
Someone is driving to Marlin to save money on gas!?!??! You idiot you buy gas as you travel through to get back to B/CS and avoid buying gas here. All of that math you must be a local Gas station owner that finds ways to rip us off.
Posted by: bv Location: madisonville on Sep 27, 2008 at 10:33 AM
I came into Bryan Tuesday after Ike and got gas at Producers. It was 4.10 a gallon. I came back the next Wed. and it was 3.59.
Posted by: DB Location: Bryan on Sep 26, 2008 at 07:57 PM
Marc, in case you haven't noticed, we live in the USA and we can drive anything we want. Stay out of my car and I'll stay out of your hemi-truck. We CAN drill for more oil and lessen our dependance on foreign oil. Our politicians just need to get their heads out where the sun shines.
Posted by: Anonymous on Sep 26, 2008 at 07:21 PM
What is the name of the price-gouging business in Madisonville? I will avoid it.
Posted by: Benny on Sep 26, 2008 at 04:52 PM
The term "price gouging" is nonsensical. As long as gas stations don't collude they should be free to charge whatever price they want. It's supposed to be a free country - at least it used to be.
Posted by: Someone is driving to Marlin to save money on gas!?!??! Location: BCS on Sep 26, 2008 at 03:19 PM
Let's say you pay $3.80 for it here and can get it for $3.50 in Marlin. Let's say you have 20 gallon gas tank. CS to Marlin is 68 miles, so 140 miles round trip. Let's give you the best mileage out there of 40MPG on your car. And let's say you end up filling up completely when you get there. You will use 3.5 gallons to get there and back. Cost to fill up 20 gallons at $3.80 = $76 Cost to fill up 20 gallons at $3.30 = $66 Money saved = $10. Cost of 3.5 gallons at $3.30 to drive to Marlin and back = $11.55 I surely hope people aren't this stupid.
Posted by: To Derek on Sep 26, 2008 at 03:10 PM
"The "store owners" set the gas price for the stations, not the oil company. All the Exxons in the Brazos Valley pay the same price for the gas that they get. So why are the prices different from Exxon to Exxon in the same town?" Don't know about Exxon, but I DO know that a couple of years ago, at least one Shell distrtibutor charged each store differently based on distance from terminal, size of load, frequency of deliveries, and "class" (an arbitrary factor chosen by the distributor), because I wrote the VBA code for the Excel worksheet that calculated the bills from the delivery truck load tickets.
Posted by: Gas Location: Bryan on Sep 26, 2008 at 11:57 AM
Investigate the store owner at Smetana Grocery at the intersection of HWY 21 and Smetana Road. Also look at the expired food on the shelves that are still for sale.
Posted by: Derek Location: Bryan on Sep 26, 2008 at 11:55 AM
The "store owners" set the gas price for the stations, not the oil company. All the Exxons in the Brazos Valley pay the same price for the gas that they get. So why are the prices different from Exxon to Exxon in the same town?! The answer is because the store owners set the price for gas. They have an "allowable" range to set the price and that is why they change the price of their gas throughout the day even though they didn't refuel their tanks. The same goes for oil companies. When they investigate "price gouging", they don't investigate Exxon or Texaco, they are investigating individual stores to why they set THEIR price so high. Don't blame this on the OIL COMPANIES, blame it on the STORE OWNERS.
Posted by: Concerned Citizen Location: Madisonville on Sep 26, 2008 at 11:55 AM
The Pilot in Huntsville went from $3.39 up to $5.25 during Hurricane Ike. Are they on the list? They need to be. Also, I agree with Mi Mi that the stores here in Madisonville went up on their prices. MS Grocery for one were charging prices outrageously. They were trying to make money in the dark. The also charge taxes when you use a lone star card when they are not suppose to. That owner is really trying to rip people off here in Madisonville. The AG's office needs to check into that also.
Posted by: Jonathan Location: Madison County on Sep 26, 2008 at 11:21 AM
Contact the gas station distributors, most of them are independent dealers. They will tell you how much they sale their gas for whole sale and compare that to the retail price the store is selling it for. When I was a teenager many years ago, we use to sell our gas at cost to attract business.
Posted by: mark Location: College Station on Sep 26, 2008 at 11:12 AM
I think we are all getting robbed, gas doesnt cost near what we pay for it. If we want to stop paying high prices, we need to stop buying at high price places a.e. Exxon, Shell.
Posted by: Marilynn Location: Madison Co. on Sep 26, 2008 at 11:11 AM
Mimi - I know what store you're talking about and we told the AG's office they were selling FEMA water and ice that had gotten for FREE! And Marc - just because you are ok driving a smaller car doesn't mean you should take away the rights of others to drive the car they chose. When I go to Bryan I buy at the Kroger. WIth your plus card you can save up to 5 extra cents a gallon.
Posted by: Tim Location: Navasota on Sep 26, 2008 at 10:55 AM
They should investigate every gas station in Navasota, they seem to always the highest anywhere around the area.
Posted by: John Location: College Station on Sep 26, 2008 at 10:41 AM
YAY I CAN USE ALL CAPITAL LETTERS TO SEEM MORE AUTHORITATIVE SO THAT WHEN I SPEW LIES PEOPLE THINK THAT I'M RIGHT!!!1!!one!! And I have noticed that prices are higher here than Fort Worth, even before Ike came through.
Posted by: Nickie Location: College-Statio on Sep 26, 2008 at 10:24 AM
Pleas, I love to read the comments posted. But, Please do not use all CAPTIAL"S . It is too hard to read and unnecessary!
Posted by: Ken Location: College Station on Sep 26, 2008 at 10:24 AM
Buy your Gas from the Murphy USA station in front of Wal Mart, when you go to Bryan. They have good prices and they give a college scholarship to EVERY graduate of the high school in El Dorado, Arkansas where they are headquartered. They also place a high emphasis on customer service. I was pumping gas at one of their stations in another town once. As I was pumping the price went up a few cents per gallon. I complained and the corporate office sent me a gift card for $20 in gas. They are good people and they value their customers. The icing on the cake is they use oil from right here in the good ole USA.
Posted by: To Marc on Sep 26, 2008 at 10:06 AM
"IF ALL PERSONAL VEHICLES WERE LIMITED TO 145 HORSEPOWER OR TAXED AT, SAY, $25 PER EXCESS HORSEPOWER, MOST MEN WOULD NOT DRIVE SINCE THEIR HORMONE BOOSTER WOULD NOT WORK. THE TESTOSTERONE THRILL WOULD BE GONE FROM THE V-8." And you'd be getting pretty hungry pretty quick, since none of the farmers or ranchers could pull the trailers they use to get grain and cattle to market. I don't drive my Ram because I want everybody to admire the Hemi Badge; I do it because nothing smaller will pull 3 round bales.
Posted by: William Location: Bryan on Sep 26, 2008 at 09:55 AM
I piad 4.10 at coop ont he Sep.15 for reguler unleaded becuase other stations were out of gas.I believe this was real price gouging,Can anyone explain this to me?
Posted by: TB Location: Bryan on Sep 26, 2008 at 09:40 AM
Why not ask Shell Oil also KBTX? They were one of the highest in town.
Posted by: Mi Mi Location: Madisonville on Sep 26, 2008 at 09:18 AM
In Madisonville there was one convenience store who definitely was price gouging that I know of (like $6.00 for 10lb bag of ice,$ 85.00 for beer ,$6.00 for 2 batteries to name just a few) and that is taking advantage of the people of Madisonville, the very ones that have enabled this business to expand in locations as well as in building space.I know of several people who are lodging complaints to the AG's office. I for one do not shop this store and do not ever intend to!!!!
Posted by: Sn Location: Bryan on Sep 26, 2008 at 09:17 AM
I wish KBTX would give us a list of the stations that are being investigated. I bet Exxon near the by-pass is on that list! Right after IKE hit, I noticed the price jumped by something like 40 cents a gallon.
Posted by: Consumer Location: College Station on Sep 26, 2008 at 09:17 AM
What KBTX needs to find out is if the AG's office is going to follow the money if they find that the stations were simply passing along the price spike they got from the distributors who in turn were passing on the spike from the Oil companies who were simply putting the limited supply of gas out for bid and letting speculators buy and then resell at whatever they could squeeze out of the buyers...
Posted by: city2country on Sep 26, 2008 at 09:14 AM
Gas is 15 to 30 cents cheaper in Austin. There is no reason gas prices should be this high in B/CS. When and if KBTX gets the information on what businesses have been taking advantage of high prices I will be the first to boycott them!
Posted by: Michelle Location: CS on Sep 26, 2008 at 08:47 AM
"AG's office is currently looking into more than 900 complaints of price gouging" is this just in the Brazos Valley? Or in the state of Texas?
Posted by: MARC Location: RUSSIA on Sep 26, 2008 at 08:23 AM
GAS PRICES ARE HIGH BECAUSE PEOPLE USE MORE THAN NECESSARY. IF ALL PERSONAL VEHICLES WERE LIMITED TO 145 HORSEPOWER OR TAXED AT, SAY, $25 PER EXCESS HORSEPOWER, MOST MEN WOULD NOT DRIVE SINCE THEIR HORMONE BOOSTER WOULD NOT WORK. THE TESTOSTERONE THRILL WOULD BE GONE FROM THE V-8. LIMITING POWER WOULD SAVE LIVES AS WELL AS PRECIOUS GASOLINE. IF THE USA PRODUCED ALL THE OIL RESERVES IN ANWR (ALASKA) IT WOULD BE BURNED IN THREE YEARS AT THE RATE SUBURBANS AND OTHER V-8 "GAS-HOGS" USE IT TODAY. USA DOES NOT PRODUCE IT NOR DOES IT HAVE THE RESERVES. PEOPLE NEED TO STOP WASTING IT.
Posted by: Anonymous Location: Grimes County on Sep 26, 2008 at 08:07 AM
I hope that any business found guilty of price gouging is heavily fined and that public remembers not to trade with them. Having said that I hope that those business' that helped, the ones who were good neighbors are rewarded and remembered by their customers. I saw so much caring and compassion during this disaster, it was awesome to see neighbors helping neighbors. Our communities worked together for the good of all. I'm proud to be a part of this community.
Posted by: MDH Location: Bryan on Sep 26, 2008 at 07:57 AM
I was in Houston Yesterday and the gas there is $3.35/gallon for regular. Why is it $.40 more here?
Posted by: Todd Location: CS on Sep 26, 2008 at 07:50 AM
I don't believe the excuse that fuel with ethanol costs less as it costs more to produce ethanol. As well, many other towns have lower fuel prices yet they do not sell fuel any different from ours. BTW, there is no ethanol in diesel anywhere yet our diesel prices are higher than anyone else's as well.
Posted by: B on Sep 26, 2008 at 07:36 AM
I paid $3.39 a gallon at an Exxon in Conroe on Sunday on I45 and SH 105. When I get back to the B/CS area, the Exxons here are at $3.75-$3.89. That is just ridiculous.
Posted by: LW Location: Bryan on Sep 26, 2008 at 07:30 AM
Interesting..... More Politicians .... We allow big companies to merge with other big companies and complain about price gouging, and we watch big sompanies like Maw Bell and power companies get broken into little companies and complain about service quality... INTERESTING
Posted by: Thomas Location: Bryan, TX on Sep 26, 2008 at 12:03 AM
Please investigate all of the EXXON'S, TEXACOS, and the MINI MARTS around town. The are considerable higher than other gas stations around town. If their not selling high gas, they're harboring sleeping terrorist cells!
Posted by: CS Location: College Station on Sep 25, 2008 at 10:48 PM
Ok.. so buying in volume can affect the price. So that being said, it would seem that a larger city (College Station) would buy more volume and sell more volume. With that thought, then the price should be cheaper right? Yet, here, we find the cheaper prices in the smaller towns where less volume is bought and sold. Huntsville gas is 10 cents cheaper than here.
Posted by: Alan Location: College Station on Sep 25, 2008 at 09:55 PM
Thank You News 3 for staying on top of this issue. I don't buy gas in College Station anymore since the story aired. Valero has cheaper gas in Marlin than they have here.
Posted by: Carly Location: Bryan on Sep 25, 2008 at 09:35 PM
How can the hurricane cause the gas prices to go up immediately? The gas that is in the tank in the ground was purchased before the hurricane and therefore they should not have to raise the price on that gasoline. Am I wrong? I saw gas prices change twice in one day at one pump. I don't understand how the figure these things, I guess.
Posted by: Paying TOO Much Location: BCS on Sep 25, 2008 at 08:44 PM
Finally! This needed to be done for a while now. We are paying MUCH higher than anyone in this part of Texas. And after the hurricane, I noticed some huge spikes that should of not happened, because those stations were located in some prime areas. If you cheated people, karma will get you back.
Posted by: Alan Location: College Station on Sep 25, 2008 at 08:01 PM
4 reasons gasoline cost more in College Station and Bryan: 1. Exxon and Shell dominate the market 2. Not enough independents to influence pricing. 3. TAMU students pay with parents credit card, and don't shop for best price, and gas stations know it. Just check the price at Exxon at 1800 Harvey Mitchell Pkwy or 2801 Texas Ave S. 4. Buyers don't avoid high priced stations enough to bring them in line. If you want to see lower prices, buy your gas at Kroger or other independents.
Posted by: way 2 go AG !!!!!!! Location: College Station on Sep 25, 2008 at 07:23 PM
There is a 34 cent per gallon difference between our average price and the price over in Huntsville which is about 50 miles away. I don't know if I would call it price gouging, but I am going to call it ridiculous.
Posted by: SN Location: BCS on Sep 25, 2008 at 06:51 PM
Please name those businesses.
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