US petrol stations accused of using AI to inflate prices in California

A group of California consumers claimed in a lawsuit that petrol station owners, including Walmart, Marathon Petroleum, BP and 7-Eleven, are using artificial intelligence to illegally manipulate pump prices in the state that already has the highest rates in the US.

The companies, which operate more than 1,700 filling stations across the state, are using an AI tool from Kalibrate Fuel Systems that automatically adjusts prices based on confidential data at a time when petrol topped US$7 a gallon in some areas, according to the complaint filed on June 22 in federal court in Sacramento.

Using the algorithm, station owners inflated petrol prices by as much as 22 US cents a gallon and diesel by 33 US cents, on top of already high prices caused by the US war with Iran, the plaintiffs alleged. Every additional penny costs California drivers about US$134 million (S$173 million) a year, according to the complaint.

In May, California’s fuel watchdog issued subpoenas to some stations owners over high prices.

The suit is among the first brought under AB 325, a law California passed in 2025 that prohibits the use of shared pricing algorithms. It seeks damages for drivers in the state who overpaid for petrol under California antitrust law.

Spokespersons for Walmart, Marathon, BP, 7-Eleven and Kalibrate did not immediately respond to e-mails seeking comment on the suit. BLOOMBERG