The Lowdown On The Gas Spike

To many, gasoline refineries are urban eyesores -- sprawling and smelly.

But as CBS News Correspondent Bob Orr reports, the dwindling number of refineries is largely to blame for America's pain at the pump. And critics say that's exactly the way big oil wants it.

"Absolutely, consumers are being gouged," says Tyson Slocum, who tracks the oil industry for Public Citizen. Slocum says giant mergers have given a few companies too much control.

Independent refineries have been gobbled up or shut down, stockpiles of gasoline are kept to a minimum, and Slocum says, companies produce just enough to meet demand.

"We've got evidence that the large oil companies have the ability, and in fact do, intentionally withhold gasoline from the marketplace," says Slocum.

Oil companies deny the charge. While an FTC investigation in 2001 found refiners pushed prices higher to maximize profits, it cleared the industry of any criminal wrongdoing.

Now, three years later, Sen. Barbara Boxer, D-Calif. wants regulators to take another look.

"I definitely think we could have a manipulation of supply just as we've had in the past with electricity," says Boxer.

Sources say the FTC is monitoring the current

"In some areas in Alaska prices are over $3," says Jason Toews.

Meanwhile, for Toews, business is also spiking. Ninety-thousand people a day visit his Web site gasbuddy.com, shopping for the cheapest pumps. Prices are high and wide-ranging.

"The cheapest, in San Diego, is $1.96, and the most expensive is $2.59 - that's almost 70 cents per gallon within San Diego itself," says Toews.

Critics charge everyone is paying more than they should. By some estimates the shortage of refineries and diminished competition are adding as much as 30 cents to the price of every gallon.