Whitehead accused of gas price gouging; he fires back

2013-05-03T17:35:00Z 2013-05-03T21:01:14Z Whitehead accused of gas price gouging; he fires backBy JORDAN PASCALE / Lincoln Journal Star JournalStar.com

Democratic Party Chairman Vince Powers accused Republican City Council candidate and Whitehead Oil President Mark Whitehead of gouging Lincoln gas buyers with higher prices than Omaha has, but Whitehead said that is untrue. 

Powers called a news conference Friday to draw attention to the issue, just four days before the city election. Thousands of mailers accusing Whitehead of the same thing have been sent out in the past few weeks by the Democratic Party.

"For years, Omaha has had 10- to 25-cents cheaper gas prices than Lincoln," Powers said Friday. "We’ve had no explanation for that and Whitehead refuses to say why he is charging more.

"If Whitehead wants our trust as an elected official, why not give us explanation?" Powers asked. "That’s because the only explanation is price gouging." 

Whitehead refuted the accusation, saying his Phillips 66 gasoline is higher quality with better additives than others, which adds to the price. He also said he isn't trying to compete with Omaha.

"Everybody positions themselves in a market where they think they need to," he said. "We decided to offer the best quality product and the best facilities in prime spots with competitive pricing to our competition.

"Other markets are irrelevant -- our customers are here in Lincoln and we are competitive in this market."

Whitehead Oil, which owns 19 U-Stops in Lincoln, represents a one-fourth of the gas stations in Lincoln, Whitehead said. Casey's General Stores operates more than 20 stores, according to its website, Kwik Shop runs 14, and other, smaller convenience stores make up the rest. 

"If they go lower, we match them," Whitehead said. "That's the way the market works."

Lincoln's average prices beat Omaha's at times, he said, which has been true a dozen times over the past three months.

Friday, gas in Lincoln averaged $3.49 a gallon; in Omaha it was $3.41, according to GasBuddy.com. AAA reported an average for regular unleaded at $3.45 in Omaha, $3.48 in Lincoln. 

An analysis of the past three months shows the largest average price differential between Lincoln and Omaha was $0.16 on April 24, but most days it was just a few cents difference.

Asked if this should be an issue in a City Council campaign, Whitehead said no.

"I guess it doesn't really surprise me a great deal," he said. "Vince is throwing things out there and see(ing) what sticks to the wall."

Whitehead said the gas price issue resonates with Lincolnites because it is the second biggest item in family budgets behind housing. 

The price disparity has been a topic of conversation for years in Lincoln. 

In 2005, then-Mayor Colleen Seng asked Attorney General Jon Bruning to investigate the differential in prices between Omaha and Lincoln. Bruning said he found no evidence of price gouging.

Reach Jordan Pascale at 402-473-7120, jpascale@journalstar.com or follow him on Twitter: @LJSPascale.

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