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Louisiana State lawmakers are looking for new ways to lower gas prices that could significantly impact the way fuel is marketed statewide.
A new Senate bill to override the state's controversial below-cost selling law is being considered in the House. The bill is similar to one a coalition led by Wal-Mart and Murphy Oil Corp. is trying to push through in Florida.
At least one economist believes the new measure would increase competition among gasoline wholesalers and retailers, in hopes of driving down gasoline prices. "Competition is the best friend the little guy ever had," said economist Bill Barnett of Loyola Business School.
During the Memorial Day weekend, gas prices in the New Orleans area hovered around $1.55 a gallon for regular unleaded.
The state currently has a law that doesn't allow retailers to sell product below cost. But the law doesn't apply to manufacturers, like Murphy Oil. "There's no reason to have restrictive competition," Barnett says. "There's no reason at all for that. It's really wrong."
Murphy sells gas at Wal-Mart-owned stores for about 10 cents per gallon less than most local convenience stores. The bill wouldn't force wholesalers to increase prices, but would instead allow retailers to lower their prices below cost to compete.
As expected, Murphy Oil officials say they welcome the competition.
Barnett would like to see the entire unfair-price law overturned, but he says that focusing on fuel products is a good start. "In any case, it will be good for the consumer, good for our society, good for our city, good for our state," Barnett added.