California Suit Says Marathon, Others Used AI to Fix Pump Prices

A group of California drivers sued Marathon Petroleum, BP, Circle K, 7-Eleven and Walmart on Thursday, alleging the gas-station operators used artificial-intelligence software to coordinate retail fuel prices and jack up what customers pay at the pump.

The complaint, filed in federal court in San Francisco, centers on a pricing platform that the drivers say lets the defendants share real-time price data and algorithmically set fuel prices in lockstep. The companies named in the suit operate roughly 60% of the stations in the state, the plaintiffs said.

Marathon Petroleum, the largest U.S. refiner and a major station operator under the Speedway and Arco brands, faces direct exposure if the case moves forward. The company already contends with a parallel Justice Department probe into its pricing practices, according to people familiar with the matter. Marathon declined to comment.

Walmart and 7-Eleven both said they would review the complaint. Spokespeople for BP and Circle K did not immediately respond to requests for comment.

The suit cites research by economists who found that stations using the algorithm charged roughly 3% to 5% more than comparable stations that did not, a gap that widened when overall fuel demand was high. For California drivers, who already pay the highest gasoline taxes in the country, that premium adds roughly $200 to $300 per year per household, the plaintiffs said.

The case arrives as the Federal Trade Commission and several state attorneys general step up scrutiny of algorithmic pricing tools across retail, from apartment rents to grocery staples. California's own antitrust enforcement office has signaled interest in the technology.

An AlphaScala score of 47/100 for Marathon Petroleum reflects a Mixed outlook, tied to regulatory and litigation uncertainty that could pressure margins even if the company prevails in court.

A hearing to set a preliminary case schedule has not yet been scheduled.