Tuesday, September 27, 2005
SLIMY REPUBLICANS AND THEIR OILY BENEFACTORS
Oil and gasoline prices were rising long before Hurricane Katrina wreaked havoc. U.S. gasoline prices jumped 14% from July 25 to Aug. 22. Indeed, profits for U.S. oil refiners have been at record highs. In 1999, U.S.oil refiners made 22.8 cents for every gallon of gasoline refined from crude oil. By 2004, they were making 40.8 cents for every gallon of gasoline refined, a 79% jump.
Faced with these facts, Congress and the White House instead recently passed energy legislation that does nothing to address any of the fundamental problems plaguing AmericaÂs energy policiesÂafter all, if it did, why are having this hearing today? As a whole, the Senate voted to approve HR 6, the ÂcomprehensiveÂ energy bill, by a vote of 74 to 26, even though the only ÂcomprehensiveÂ aspect of the legislation is the $6 billion in subsidies to big oil companies. The only possible explanation for why Congress would bestow these subsidies on oil companies are the $52 million in campaign contributions by the oil industry, with 80% of that total going to Republicans.
Remember, environmental regulations are not restricting oil drilling in the United States. An Interior Department study concludes that federal leasing restrictionsÂin the form of wilderness designations and other leasing restrictionsÂcompletely block drilling of only 15.5% of the oil in the five major U.S. production basins on 104 million acres stretching from Montana to New Mexico. While only 15.5% is totally off-limits, 57% of AmericaÂs oil reserves on federal land are fully available for drilling, with the remaining 27.5% featuring partial limitations on drilling. This report contradicts industry claims that environmental laws are squelching production.
Congress can restore accountability to oil and gas markets and protect consumers by supporting Public CitizenÂs 5-point reform plan:
Implement a windfall profits tax or enact temporary price caps.
Launch an immediate investigation, including the use of subpoena, into uncompetitive practices by oil companies.
Reevaluate recent mergers, particularly in the refining sector.
Re-regulate energy trading exchanges to restore transparency.
Improve fuel economy standards to reduce demand.