In a development that reflects growing concerns about the use of artificial intelligence in pricing, a group of major fuel and retail companies in the US state of California is facing a class-action lawsuit accusing them of using smart algorithms to artificially inflate petrol prices, driving up costs by roughly 30 cents per gallon in some areas.
Three California residents filed the lawsuit, alleging that major companies including BP, Marathon Petroleum, 7-Eleven, Walmart, and Albertsons used AI software specialised in fuel pricing to coordinate price-setting, in violation of the state's competition laws.
Allegations
The case centres on the "Calibrite Fuel Pricing" programme, an AI-based system believed to connect fuel stations to a central server that sets prices automatically, raising suspicions of illegal coordination among the companies.
The plaintiffs rely on a legislative amendment that took effect in January 2026 under California's Cartwright antitrust law, which prohibits the use of algorithms in price-setting if they are likely to harm competition or cause market manipulation.
No official comment has yet been issued by the accused companies or by Calibrite, the developer of the software.
Fuel prices are among the most sensitive issues in California, which is home to approximately 40 million people and has more than 27 million petrol-powered vehicles that consume roughly 13.4 billion gallons annually.
According to data from the American Automobile Association, the average price of a regular gallon of petrol in the United States is approximately $3.93, while the average price in California stands at $5.54 — about $2 above the national average. The plaintiffs assert that prices in some areas have exceeded $7 per gallon.
The plaintiffs are seeking financial compensation for the additional amounts they were forced to pay over recent months due to what they described as "excessive algorithmic pricing".
Observers believe the case could constitute an important legal test of how artificial intelligence is used in markets, and may open the door to stricter legislation regulating algorithms that are increasingly influencing the prices of goods and services, most notably fuel.