Raleigh, N.C. — A Mebane-based gas distributor accused of conspiring to fix prices and trying to force a Durham gas station to raise its prices after Hurricane Katrina has agreed to pay a $25,000 penalty, Attorney General Roy Cooper announced Wednesday.

The Attorney General's Office sued McLeod Oil Co. Inc. and Home Oil Inc. in October 2005, alleging that they tried to fix the price of gas sold in Durham County and raise prices by at least 20 cents a gallon. The alleged conspiracy came a few weeks after Hurricanes Katrina and Rita hit the Gulf Coast and disrupted oil refinery production, sending gas prices up nationwide.

One gas station refused to go along with the price increase and reported the effort to authorities.

Under a consent judgment signed Monday by Superior Court Judge Robert Hobgood, McLeod Oil and Home Oil are barred from trying to set the price of gas at stations they supply and from establishing a minimum price above which stations must sell their gas. They also cannot retaliate against anyone who refused to peg gas prices or cooperated with the state investigation.

“Price fixing hurts competition and consumers’ wallets,” Cooper said in a statement. “We’re sending a message to other companies
that we expect them to do right by consumers and small businesses or we’ll hold them accountable.”