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By John Ravelo

SAIPAN, CNMI (Saipan Tribune, Nov. 2) – The Attorney General's Office yesterday released findings by the Federal Trade Commission that apparently justified Mobil's prices on Tinian and Rota.

The AGO has brought no court action against Mobil so far, but Attorney General Pamela Brown stressed that the CNMI's Consumer Protection Act prohibits petroleum providers from engaging in price-fixing, which has no reasonable relationship with their costs. Brown vowed to continue monitoring fuel price adjustments in the CNMI.

"We cannot allow providers of this essential commodity to operate unchecked here. We will continue to work with the FTC and other state AGOs to ensure fairness," Brown said. "By studying the market, monitoring wholesale and retail prices, and sharing ideas and information with other law enforcement agencies, we can determine what is a reasonable price under the circumstances."

Citing the FTC's initial findings, CNMI consumer counsel Brian Caldwell said a variety of factors could affect prices on Tinian and Rota, as well as those on Saipan.

The FTC's initial findings came about after the AGO requested for assistance in looking at Mobil's pricing, since gas prices on Tinian and Rota continue to be high despite price rollbacks being undertaken by the fuel company on Saipan late last year.

The AGO had subpoenaed documents from Mobil, which were turned over to the FTC for analysis by the federal agency's gas and oil experts.

"All three islands get their bulk supply from Singapore. Gasoline is shipped from Singapore to Guam and then to Saipan in one ship, then loaded to a smaller ship for delivery at Tinian and Rota. Because of weather issues, port restrictions, and even darkness, there can be periodic shortages of gasoline on Tinian and Rota that may affect prices," Caldwell said.

"In addition to weather-related issues, the cost of transport between Singapore and Saipan fluctuated with almost every shipment. All these factors impact wholesale pricing to the islands," he said.

The AGO sought the FTC's assistance sometime in February following complaints that Mobil's pump prices on Rota and Tinian breached $3 per gallon, when both Mobil and Shell were rolling back fuel prices on Saipan late last year. In recent months, however, even Mobil's prices on Saipan had reached nearly $3.50 a gallon due to consecutive price adjustments.

But last Oct. 26, Mobil implemented a price rollback of up to 10 cents per gallon. Shell followed suit the next day and implemented a rollback of up to 12 cents per gallon.

Mobil's gallon prices for unleaded and super gasoline, respectively, are now $3.239 and $3.399 at full-serve rates, and $3.069 and $3.239 at self-serve rates. Mobil gas stations retail diesel at $3.309 $3.259 per gallon at full- and self-serve rates, respectively.

Shell's gallon prices are $3.179 and $3.339, respectively for regular and premium gasoline at full-serve rate. Its self-serve rate now sells at $3.049 and $3.219 per gallon. The price of diesel slightly dropped by 4 cents to $3.309 per gallon at full-serve rate.

Both Mobil and Shell said the decrease in fuel prices resulted from the softening of regional product costs particularly on Singapore.

November 2, 2005

Saipan Tribune

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