[Congressional Record Volume 150, Number 71 (Wednesday, May 19, 2004)]
[Senate]
[Pages S5738-S5739]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                                 ENERGY

  Mr. REID. Mr. President, we have people from the majority coming out 
here occasionally talking about how important it would be to pass an 
energy bill. I listened to the President's press secretary yesterday 
saying: Well, the reason we are not having lower gas prices is because 
the Democrats won't help with the Energy bill.
  This is simply talk. It has absolutely has no merit. All we need to 
look at is what the administration itself says about the Energy bill. 
The Department of Energy's Energy Information Administration studied 
this question and concludes the legislation's incentives to reduce our 
reliance on foreign oil sources will have a negligible success. The 
report, prepared by the administration for a Republican Senator, 
states:

       On a fuel-specific basis, proposals in the [conference 
     report] including changes to production, consumption, 
     imports, and prices are deemed to be negligible.

  The bill won't address our energy needs in the future. It won't 
protect middle-class families who are being gouged with the gas prices 
we see today. Nevada has the second or third highest gas prices in the 
country. Gas prices across the Nation have reached alarming levels, 
especially in Nevada and California. A regular, unleaded gallon of 
gasoline costs $2.22 in Las Vegas, $2.29 in Reno, while higher blend 
fuels are at about $2.50 a gallon. I have to say, this was written on 
Monday. This is 2 days later. I don't know what it is today. But it has 
gone up.
  Since the first of the year, the price of gasoline has increased more 
than 58 cents a gallon in Nevada. There is no doubt the price of crude 
oil has contributed to higher gasoline prices, but this outrageous 58-
cent increase in Nevada since January has not been driven by the rising 
cost of crude oil but by corporate greed and the never-ending quest for 
profits, no matter what it does to the consumer.
  Big oil companies and refiners are getting rich. Middle-class 
families are getting gouged. I had in my office last week a wholesale 
distributor from Las Vegas and Reno. If a service station wants some 
oil products, gasoline, that is where they get it. These companies are 
going broke because they can't pay for the huge cost of fuel. The 
markup they get is 2 or 3 cents a gallon. They make 2 or 3 cents a 
gallon on the fuel they sell. So it is not the service station 
operators making the money. It is not the person who gives them the 
fuel. It is the big suppliers. Big oil companies and refiners are 
getting rich. Middle-class families are getting gouged.
  I am not making this up. It is documented. Refiner margins have 
doubled and tripled. Oil companies weren't content to make 25 cents for 
every gallon of gasoline.
  They now make up to 75 cents for every gallon of gasoline sold.
  Look at this. Who is better off? Oil companies report record profit 
increases. British Petroleum did OK last year, a 165-percent increase 
in their profits. Chevron-Texaco are the record holders, a 294-percent 
profit. Exxon-Mobil, a 125-percent profit. Conoco-Phillips, I don't 
know what happened to this company; they only made a 44-percent 
increase in profit last year. That is all. Conoco-Phillips is down at 
the bottom. They made a profit before, but now they had an additional 
44-percent increase in profit. I repeat, British Petroleum had a 165-
percent increase in profit compared to the previous year; Chevron, a 
294-percent increase in profit compared to the preceding year; and 
Exxon-Mobil, a 125-percent increase in profit. I am not making this up. 
These companies are gouging.
  We have all received letters from our constituents. I have received 
them from Nevadans whose budgets are stretched. They have to make a 
choice between food, a place to live, and medicine. This is the way it 
is. It is too bad. Gasoline is not a luxury; it is a necessity. 
Families have to put gas in their vehicles so they can drive to work, 
take the children to school, and go to the grocery store.

  Big oil companies control it all. British Petroleum, Chevron-Texaco, 
Conoco-Phillips, Exxon-Mobil, they make the money. And as long as they 
can show their shareholders they are doing great, it doesn't matter 
what is happening to the country or the people who work for these 
companies. They control the supply. They know families have little 
choice in the matter. They literally have consumers over a barrel of 
oil.
  While consumers are paying record prices, the oil companies are 
reaping record profits. These profits are outrageous. I believe in the 
free enterprise system, but if you carry this to its extreme, there 
isn't much left for the consumer.
  Major California refineries owned by Valero and Tesoro that supply 
the Las Vegas-Reno area have reported record profits and project even 
bigger gains in the months ahead. Record profits for big oil; record 
prices for American families.
  I have asked the Federal Trade Commission to stop this price gouging, 
but they won't act. The FTC continues to study the problem while gas 
prices skyrocket. We all agree something must be done. It is a simple 
fact that we can't drill our way out of the problem. We are sitting on 
less than 3 percent of the oil reserves of the world. This includes 
ANWR. We consume 25 percent of the oil that is produced, and 97-plus 
percent of the oil reserves in the world are someplace else.
  We need to find an innovative new solution, but this administration's 
energy policy is stuck in the past. It is slanted toward big oil and 
special interests generally. This is a policy that was hatched in 
secret 3 years ago by the Vice President's energy task force. This is 
the task force that refuses to produce the records of who met, where 
they met, what they talked about. This has gone to court. They have 
stalled it for almost 4 years.
  This past Sunday the Washington Post reported on the influence that 
has been wielded in this administration by the people who raised large 
amounts of money for President Bush's campaign. One of the four people 
who organized the entire fundraising apparatus was Donald Evans, a 
Texas oil man. The article also noted the influence of Enron CEO Ken 
Lay--``Kenny boy,'' as he was called by the President--who served on 
the Energy Department transition team and recommended two of the 
appointees to the five-member Federal Energy Regulatory Commission. Is 
it any wonder nothing is being done?
  When it comes to national energy policy, this administration is 
taking care of the Enrons, the big oil companies, while middle-class 
families and other families are gouged. Our Nation must promote the 
responsible production of oil and gas, but that doesn't mean we should 
roll back environmental protections of our priceless public lands to 
allow drilling. Remember, we cannot produce our way out of this 
problem.
  If we allow drilling in ANWR, with all the roads and other support 
structures that would be required, we would despoil a national treasure 
for little long-term gain in energy security.
  Instead of squandering our children's birthright for a temporary 
supply of oil, we should do a better job of conserving.
  If all our cars, trucks and sport utility vehicles got an average of 
27.5 miles per gallon, we would save more oil in 3 years than could be 
recovered economically from the entire Arctic National Wildlife Refuge.
  I know we can do it because we did it once before.
  After the 1973 Arab oil embargo, when Americans were forced to wait 
in

[[Page S5739]]

long lines to buy gasoline, we realized that our dependence on oil from 
the Middle East was compromising our national security.
  So we dedicated ourselves to building vehicles that were more fuel-
efficient. And by 1990, the average American vehicle got 40 percent 
more miles per gallon than in 1973.
  That is an American success story, a triumph of good old American 
ingenuity.
  We need to redouble our efforts to conserve oil.
  We also need the President to stop filling the Strategic Petroleum 
Reserve.
  It is more than 90 percent full. How much is enough?
  There have been two major releases of oil from the SPR. Crude oil 
prices fell sharply each time.
  The first SPR release occurred as the U.S. began bombing Iraq on 
January 16, 1991. The next day crude oil prices fell from $32 to $21 
per barrel.
  The second release occurred in September 2000. Crude oil prices 
immediately fell from $37 to $31 per barrel after this release was 
announced.
  The President also needs to pressure OPEC to significantly increase 
its production quotas to lower the price of oil on world markets.
  These are some immediate steps we can take to help middle class 
families.
  But to meet our energy needs over the long term, we need an energy 
policy that looks to the future.
  I have already talked about the need to conserve oil.
  Conserving would protect consumers, and it would make our country 
stronger.
  Thomas Friedman, who covers the Middle East for the New York Times, 
wrote last week that we must renew our efforts to free ourselves from 
our dependence on oil from that region.
  He suggested an effort modeled after the Manhattan Project. That, of 
course, was our extraordinary race to develop a nuclear weapon during 
World War II.
  The Manhattan Project was a success. It helped keep the world free.
  And we can do it again.
  We are going to be spending a lot of time this week talking about 
national defense, about ways to make our country stronger.
  Well, we can make our country stronger by finding an efficient and 
environmentally sound way to produce hydrogen fuel.
  We can find a way to produce hydrogen fuel by harnessing our abundant 
renewable energy sources--the power of the wind, the warmth of the sun, 
and the heat within the earth.
  We need to break this bill apart and extract what is good.
  Let's take elements of this energy legislation that enjoy broad, 
bipartisan support, and move them forward to the President's desk.
  I was encouraged that the FSC/ETI bill passed by the Senate last week 
contains the Energy Tax Incentives.
  I applaud Senators Grassley, Baucus, and Domenici for the provision 
that expands and extends the production tax credit for wind, 
geothermal, solar, and biomass energy.
  The FSC/ETI bill also guarantees a commodity floor price for the 
Alaskan Natural Gas Pipeline.
  I strongly support a price floor and loan guarantees to build an 
Alaska Natural Gas Pipeline, but this supply won't enter the market for 
another 10 years.
  Senator Cantwell has introduced a standalone bipartisan bill to 
improve the reliability of our Nation's electric transmission system.
  This bill is noncontroversial and can pass both Houses of Congress.
  We can pass meaningful parts of this energy legislation, and begin to 
implement a strategy that looks toward the future.
  We need to act now.
  The PRESIDING OFFICER. The Senator from Minnesota.
  Mr. COLEMAN. Mr. President, can the Chair advise where we are in the 
business of the Senate?
  The PRESIDING OFFICER. We are in morning business.

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