The Texas Department of Insurance has blocked Allstate's plan to raise homeowner insurance rates by 5.9 percent. Regulators faulted the proposal as unreasonable and excessive. Insurance Commissioner Mike Geeslin's order came one day after Allstate Insurance announced the rate hikes would take effect immediately for policy renewals. The commissioner says Allstate is now restricted from raising rates without supervision from state regulators. He says the company has "repeatedly'' tried to impose excessive rates on its customers over the last three years. Allstate, the state's second-largest home insurer, says the rate increase is necessary considering the risks associated with doing business in Texas. Spokesman Bill Mellander says the company believes the rate hike was justified and competitive. Geeslin also rejected a two percent rate increase that Allstate had proposed for coastal counties.
Shell, Chevron and Saudi Refining are being accused of conspiring to fix gas prices for 23,000 franchise owners nationwide. Nearly two-dozen gas station owners in California have filed suit in San Francisco federal court and are seeking class-action status. The station owners say chairmen of the three oil companies met privately nearly every month starting in 1996 to collude on prices. The suit contends they jacked up the wholesale price by 20 to 40 cents a gallon in nearly every state from 1999 to 2001. A plaintiffs lawyer says gas prices soared for franchise owners at a time when inflation-adjusted crude oil prices had hit their lowest levels since the Great Depression. The suit says dealers were forced to either cut profits or pass on the cost to their customers. The U.S. Cupreme Court threw out a similar suit last year.
The Energy Department says U.S. gasoline supplies fell last week for the third straight time. Imports dropped below one million barrels per day and production dipped slightly. Stockpiles of the motor fuel fell by 5.7 million barrels, or nearly 3 percent. Gasoline inventories were 6.5 percent below year-ago levels. Crude oil inventories rose by 1.9 million barrels, more than expected. The report also showed that stocks of distillate fuel, which include diesel and heating oil, rose by 1.3 million barrels. At the pump, gas prices rose less than a penny overnight to a national average of $2.78 a gallon for regular-grade gasoline, according to AAA and the Oil Price Information Service. Retail gas prices are down from a May 24th peak of $3.23 per gallon.
Petroleum explorers made high bids totaling $290 million for 282 offshore oil and natural gas tracts in this year's sale of federal leases in the western Gulf of Mexico. Forty companies made bids for the leases offshore of Texas. The sale offered more than 3,300 tracts consisting of about 18 million acres. Last year's western Gulf sale resulted in $341 million in high bids for 381 tracts. That was the largest sale in that region in eight years. Recent sales have focused on "ultra-deepwater'' sites of at least 800 meters in depth that require expensive long-term development. Another focus has been tracts of 200 meters or less, considered prime ground for the development of natural gas deposits deep in the earth.
The top 10 companies in Wednesday's sale of federal offshore petroleum leases in the western Gulf of Mexico, based upon the total of high bids submitted: Statoil Gulf of Mexico--36 high bids totaling $138.9 million; BP Exploration & Production--91 high bids totaling $31 million; Petrobas America--34 high bids totaling $29.3 million; Devon Energy Production--26 high bids totaling $20 million; ConocoPhillips--24 high bids totaling $12.4 million; Hydro Gulf of Mexico--12 high bids totaling $10 million; Log Exploration Offshore--three high bids totaling $9.4 million; Bois d'Arc Properties--two high bids totaling $9.4 million; Shell Offshore--three high bids totaling $4.4 million; and Anadarko Petroleum--9 high bids totaling $4.1 million.
TXU Corporation and the private equity firms trying to buy it spent about $17 million on lobbyists and advertising during the most recent session of the Texas legislature. That's according to a report by a group that tracks political spending. The legislature considered but rejected bills that could have spoiled the pending $32 billion TXU buyout by New York-based KKR and Fort Worth-based TPG Capital. Texans for Public Justice says TXU lobbyists reported the company and its would-be buyers spent about $11 million on advertising, $6 million on lobbyists and $180,000 to entertain lawmakers and their staffs. The advocacy group said TXU hired 65 lobbyists during the legislative session, and the investors trying to buy the company hired another 21 lobbyists. The highest-paid lobbyist--at $351,000--was former Dallas Mayor Ron Kirk. TXU spokeswoman Lisa Singleton said the company reported employees as lobbyists even if lobbying "may only be a small part of their overall job.''