By Katrina Altersitz
Capital News Service
Friday, Sept. 9, 2005

ANNAPOLIS - Gov. Robert Ehrlich Jr. confronted leaders of the gasoline industry over what he termed Maryland's "artificially high" gas prices Friday, telling them he was unsatisfied with their explanation and demanding they return Monday with some better answers.

"I still do not and will not accept what I've heard" in regard to the dollar-high increase over the past month, Ehrlich said after a 90-minute meeting in the State House with more than a half-dozen representatives of the petroleum refiners and suppliers.

"It's my belief -- my strong belief -- that (the price of gas) is artificially high and needs to come down quickly," he said.

Drew Cobbs, executive director of the Maryland Petroleum Council and spokesman for the group, gave a different characterization of the meeting, describing it as "very productive." In a meeting with reporters afterward, he repeated the explanation that apparently failed to satisfy the governor.

Maryland's high gas prices, he said, initially resulted from Hurricane Katrina's damages to the Gulf of Mexico's refineries, from which Maryland receives 70 percent of its gasoline. Compounding that problem is the state's requirement for a "specific recipe" for gas needed under the Clean Air Act, which the federal government has not waived, despite requests from the governor.

Since then, Cobbs said, it has been a matter of supply and demand. Although the pipeline between Maryland and the Gulf is fully operational, Maryland is getting less gas than it used to. The state is at the end of one pipeline and close to the end of another, so much of the supply is taken before it gets here.

"Because supply is so tight and people want it so badly," Cobbs said, "that's what's driving the price up."

Ehrlich said he understood the basic economics of the situation and the reason for the spike following a hurricane, but he was adamant that there could be more done to lower prices. He said the meeting, requested by state officials, was "informational and educational" and later described it as a "very blunt" session and only "somewhat productive."

"I am not satisfied with the answer in respect to price," Ehrlich said. "I do not understand why Maryland has to be a top five or top 10 state (in gasoline prices). ... I want more direct answers Monday."

The fact that Ehrlich, a conservative Republican with a pro-business record, was to be found jaw-boning gasoline dealers over the workings of the free market is a measure of the extreme pressure that all politicians are feeling from constituents over high gasoline prices. Friday, he said it would be "premature" to talk about a special session of the General Assembly to address the issue, but he clearly left the threat out there.

On Friday, Maryland's gas prices stood at $3.22, according to AAA. One month ago, the average was $2.36, and one year ago it was $1.85.

Ehrlich said he and the attorney general would be pursuing an investigation into price gouging, which he believed to be occurring in a few instances but not many. While that goes on, the governor wants prices to come down.

"We have seen some incremental improvement over the past three days and that's a good thing," he said. "But it is not fast enough. Not enough, period."

Banner graphic by April Chan, incorporating photo from the National Oceanic and Atmospheric Administration; Newsline Web content edited by Chris Harvey; Capital News Service stories edited by Adrianne Flynn and Tony Barbieri.  

Copyright © 2005 University of Maryland Philip Merrill College of Journalism