A driver refuels his vehicle at a Marathon gas station in Martinez, California. (David Paul Morris/Bloomberg)
key takeaways:
- California consumers sued Walmart, Marathon Petroleum, BP and 7-Eleven on June 22, accusing them of illegally manipulating pump prices in AI-powered fuel pricing.
- The plaintiffs said Calibrate’s algorithms raised gas prices in California by 22 cents per gallon and diesel by 33 cents per gallon.
- Walmart said it was reviewing the complaint, BP declined to comment and California’s fuel watchdog has issued subpoenas to some station owners over the high prices.
A group of California consumers claimed in a lawsuit that gas station owners including Walmart Inc., Marathon Petroleum Corp., BP and 7-Eleven Inc. are using artificial intelligence to illegally manipulate pump prices in the state, which already has the highest rates in the US.
The companies, which operate more than 1,700 filling stations across the state, have been using Calibrate Fuel Systems’ AI tool, which automatically adjusts prices based on confidential data when gasoline was above $7 a gallon in some areas. Complaint Filed June 22 in federal court in Sacramento.
The plaintiffs alleged that using the algorithm, station owners raised gasoline by 22 cents per gallon and diesel by 33 cents, in addition to already high prices due to the US war with Iran. According to the complaint, each additional penny costs California drivers approximately $134 million a year.
Last month, California’s fuel watchdog issued summonses to some station owners over high prices.
The lawsuit is the first brought under AB 325, a law California passed last year that prohibits the use of shared pricing algorithms. It seeks damages in the state for drivers who overpaid for gas under California antitrust law.
Walmart said in a statement it “is reviewing the complaint and will respond appropriately in court. BP declined to comment. Spokespeople for Marathon, 7-Eleven and Calibrate did not respond to emails seeking comment on the lawsuit.
Gas prices in California are being closely monitored by the state’s energy regulator after Governor Gavin Newson signed a series of bills in 2023 and 2024 to strengthen oversight of the industry.
The nation’s highest pump prices have been a sticking point for Newsom, who is expected to make a bid for the 2028 Democratic presidential nomination and has softened his once-hostile approach toward the state’s declining fuel-making industry. California’s fuel prices have also become a rallying point for the Trump administration, with Energy Secretary Chris Wright promoting a controversial offshore oil-drilling project in the state.
Walmart ranked No. 1 on Transportation Topic’s Top 100 list of the largest private carriers in North America.
