Wednesday, November 01, 2006

Yeah, Right: Gas price rise undermines U.S. election conspiracy

Gas price rise undermines U.S. election conspiracy
By Tom Doggett

WASHINGTON (Reuters) - A widespread conspiracy theory that the White House engineered gasoline prices lower to influence next week's congressional elections was undermined by news of a small hike at the pumps last week, the industry's main trade group said on Tuesday.

Polls show that many Americans believe oil companies have been working with the Bush administration to keep gasoline prices lower in an effort to help Republican candidates. The White House has denied such a link.

"It's all supply and demand. The (oil) companies do not have the ability to manipulate the market in any way," said John Felmy, chief economist for the American Petroleum Institute trade group.

The Energy Department reported Monday that the national price for gasoline increased a penny to $2.22 a gallon last week, the first rise in three months.

Felmy said that if the White House were working with oil companies to control gasoline prices, they would not want them to go up a week before the election.

Since reaching a summer high of $3.04 a gallon in early August, the average price for gasoline had fallen a record 11 weeks in a row by 83 cents, mainly due to a steep decline in crude oil prices. Oil accounts for about half the cost of making gasoline.