Madigan, Emanuel demand explanation for gas price spikes

Illinois Attorney General Lisa Madigan and Chicago Mayor Rahm Emanuel say they are not buying the refinery-outage explanation for recent gasoline price spikes in the state and throughout the Midwest.

Madigan and Emanuel released a joint letter on Monday to the Illinois Petroleum Council, an oil industry trade group, criticizing prices increases that, in some cases, amounted to 60 cents in two days earlier this month. Prices shot up to as much as $4 a gallon in Chicago to $3 a gallon in Springfield before falling in the past week.

The statewide average for regular self-serve unleaded was $3.01 a gallon on Monday, according to AAA Chicago. In Springfield, the average was $2.72 per gallon -- though at some stations, the price had dropped to below $2.70, according to the gasbuddy website.

A partial outage at a BP refinery in Whiting, Indiana, on Aug. 8 was blamed for price increases across the Midwest, but Madigan and Emanuel said the outage alone could not explain the higher prices.

"Unfortunately, every time gas prices rise, oil companies give us excuses," Madigan said in a statement. "The oil companies need better contingency plans because drivers deserve answers and relief from these outrageous prices."

The spike is particularly troubling when the falling price of crude oil is taken into account.

According to the Wall Street Journal, oil prices plunged to fresh six-year lows Monday on concerns about a slowdown in Chinese demand and growing crude-oil supplies in the U.S.

Brent, the global oil benchmark, fell through its January lows to trade below $45 a barrel for the first time in six years. The U.S. oil benchmark settled down $2.21, or 5.5 percent, at $38.24 a barrel on the New York Mercantile Exchange, the first settlement below $40 a barrel since February 2009.