Official confirms post-Katrina gas price gouging

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ANNAPOLIS (AP) -- Attorney General J. Joseph Curran Jr. says Maryland's gas stations earned record profits in the days after Hurricane Katrina, confirming suspicions of price gouging in the aftermath of the August 2005 storm.

Mr. Curran, a Democrat, told leading state lawmakers that station owners and suppliers increased prices well above necessary. He found no violation of Maryland law but recommended the state adopt measures to prevent price gouging in future crises.

"Many stations enjoyed dramatic increases in per-gallon profit margins," Mr. Curran told Senate President Thomas V. Mike Miller Jr., Calvert and Prince George's Democrat, and House Speaker Michael E. Busch, Anne Arundel Democrat.

Profit margins were higher in early September than before the hurricane struck on Aug. 29, Mr. Curran said.

According to AAA statistics, average prices increased to $3.26 a gallon for regular unleaded gasoline in Maryland on Sept. 2, 53 cents more than the previous day.

The average fuel price in the District on Sept. 7 was a record $3.38 a gallon, according to AAA.

Gas station owners defended their industry, saying they are at the mercy of suppliers.

"Some of our guys only have a 3-cent-per-gallon profit," Marta Gates, director of operations for the Washington, Maryland, Delaware Service Station and Automotive Repair Association, said Friday.

The association represents about 500 service stations in Maryland.

In 2004, Virginia passed the Post-Disaster Anti-Price Gouging Act, which prohibits suppliers or sellers of goods and services from charging unconscionable prices in the aftermath of disasters in the state during a 30-day period following a declared state of emergency. Virginia is one of about 25 states to have such a law.