[Congressional Record (Bound Edition), Volume 146 (2000), Part 2]
[Senate]
[Pages 2204-2205]
[From the U.S. Government Publishing Office, www.gpo.gov]


[[Page 2204]]

                        THE RISING COST OF FUEL

  Mr. LIEBERMAN. Mr. President, I rise this afternoon to speak with my 
colleagues about the justifiably increasing concern among the American 
people about the increasing price of gasoline and other fuels.
  The fact is that our gas pumps are fast turning into sump pumps for 
American pocketbooks. Just 2 days ago, the Energy Information 
Administration pegged the average current retail price for a gallon of 
gas at $1.54. That is the highest level in a decade for this time of 
the year.
  Unfortunately, this is not the end of it. Prices are expected to soar 
beyond this height in the months ahead. In fact, the Energy Information 
Administration is projecting an average price of more than $1.80 a 
gallon of gas by Memorial Day, the start of the summer driving season.
  That is, in and of itself, according to experts on oil pricing to 
whom I have spoken, an optimistic assessment. It is predicated on the 
promises of several OPEC nations that they will raise their production 
of oil after their March 27 meeting and thus lower the price of crude 
oil.
  There are very reputable analysts of oil markets who are saying the 
average per gallon price of gasoline will go to $2 and in some places 
as high as $2.50 a gallon this summer. Ouch. That is not only 
unprecedented but will have a disastrous effect not only on individual 
businesses and consumers, particularly those of more modest average 
means, but it will, I am afraid, have a disastrous effect on our 
economy, setting off a vicious cycle of prolonged oil price increases, 
an increase in inflation rates, corresponding hikes in interest rates, 
and a stall in the historic run of economic growth we have had over the 
last several years.
  Another consequence of oil price increases, as we unsettlingly saw 
yesterday, could be significant declines in the stock markets. I 
understand the decline yesterday was attributed not just to oil price 
increases but also to the report from Procter & Gamble that they would 
be reporting lower quarterly profits than were expected. But oil price 
increases are part of it.
  Not surprisingly, yesterday crude oil trading on the New York 
Mercantile Exchange rose $1.95 to $34.13 a barrel, which is the highest 
level increase since November 1990--the highest level increase in a 
decade.
  I trust that my colleagues are hearing from their constituents, both 
individual and business, as I am, with complaints ever more vociferous 
about the strain this price spike in gasoline is putting on their 
family and business budgets. As these energy and transportation costs 
continue to climb, the cries for help will also increase.
  The squeeze is now being felt across the country, but it constitutes 
for us in the Northeast the second chapter of this current sad story of 
energy pricing since, as I know you know, Mr. President, the State of 
Connecticut and the entire Northeast was particularly hard hit by a 
prolonged price shock in home heating oil, which more than doubled in a 
space of months the amount people in our region of the country were 
paying. So this jump now in the price of gasoline represents what might 
be called a ``double energy pricing whack.''
  Last week, on Thursday, several Members of Congress in both parties 
were invited to the White House for a meeting of the President, 
Secretary Richardson, Secretary Summers, and others in the 
administration to discuss these matters. It was a spirited discussion 
and one that represented a very good exchange.
  I say to my neighbors and constituents in the Northeast that the most 
encouraging part of the discussion to me was the receptivity of the 
administration to an idea that my colleague from Connecticut, Senator 
Dodd, and I put forward to create a regional home heating oil reserve--
not crude oil as in the Strategic Petroleum Reserve we have now but 
home heating oil which could be used in cases as the one we just 
experienced in the Northeast when there was what I consider to be an 
artificial rise in price based on the OPEC cartel limiting supply in 
what is, after all, a critically necessary commodity--fuel.
  It would allow this reserve to immediately put out at times such as 
this in the future an amount of home heating oil, distillate product--
it could go for diesel fuel as well, where price increases have so hurt 
truckers--to raise supplies so that the price could decline to a more 
balanced point.
  Work goes on and discussion goes on. This idea could be a model in 
energy shortages in other regions. Some regions dependent on propane, 
for instance, might create similar reserves that could be used to 
effect when artificial prices create dramatically increasing prices.
  I look forward to continuing those discussions with the 
administration. At a minimum, if we can do something between now and 
next winter, it will give people and businesses in the Northeast some 
comfort--I apologize for the metaphor--but a kind of security blanket, 
if you will, so that next year, if OPEC again reduces supply, they will 
have the home heating oil at reasonable prices to heat their homes and 
businesses.
  Let me turn now to the gasoline price increase which is now going 
across the country and has very significant ramifications for our 
economy overall.
  My apologies to Ernest Hemingway. I ask, For whom does the gas pump 
toll today? I say the answer is, It tolls for us--not just that we are 
paying it, but it should remind us once again of the debilitating 
dangers of our dependence on foreign oil, reminding us that our 
consumers and our economic security are being held hostage by the 
decisions of the OPEC producers as they are in this case following 
their own interests, but it is not in our interest.
  No matter how great a country we are--the strongest country in the 
world, the most successful economy with the greatest standard of 
living--we have put ourselves in a position where a small group of 
nations, because they control this commodity--oil--that is so vital to 
us, can hold us hostage.
  So the President has to send the Secretary of Energy and others, 
basically, pleading with these oil-producing countries that are 
supposed to be our friends and allies to get reasonable and to increase 
the supply so that they fill at least the two-million-barrel-per-day 
gap between supply and demand on world oil prices.
  I hope as we face this crisis, though, we will take steps to 
declare--as we have been saying now for two decades, but to do it 
hopefully with some meaning, greater meaning--energy independence, and 
to do so by tapping in more vigorously to the supplies of energy over 
which we have some control, such as natural gas and oil, where that is 
possible within our own domestic control.
  Mr. President, I think we have to more aggressively try to convert 
and develop supplies of energy in our control. We have to more 
aggressively support conservative efforts and development of renewable, 
cleaner sources of energy. We have to be prepared to invest and 
continue to support even more aggressively some of the pioneering, 
pathbreaking work being done in the automobile industry to develop 
high-fuel-efficiency vehicles.
  Very exciting work is being done, and we can help with further 
support in the development of fuel cells as a renewable clean source of 
energy. The truth is, no matter how strong, innovative, 
entrepreneurial, and how great our increases in productivity are in 
this country, until we invest more into the energy that drives our 
economy, we are going to be subject to being effectively brought to our 
knees and having our markets and our bank accounts follow down in that 
direction.
  Another item discussed at the meeting with President Clinton and 
Secretary Richardson last week, advanced by my colleague and friend 
from New York, Senator Schumer, Senator Collins of Maine, and others, 
was, in this

[[Page 2205]]

crisis, to be prepared to either swap or draw down the Strategic 
Petroleum Reserve, in which there is now approximately 580 million 
barrels of oil owned by the taxpayers of the United States, and put 
some of that at this critical moment into our economy as a way to fill 
the gap between supply and demand, and, frankly, as a way to let our 
friends at OPEC know that, though our resources are limited, they are 
not meager and that we are prepared to contend with their artificial 
inflation of oil prices.
  I report these developments to my colleagues and say I believe that 
the President, at least, is keeping the option of using oil from the 
Strategic Petroleum Reserve on the table. No commitments were made, no 
decision was made either about that or a final decision made about the 
strategic heating oil reserve for our region that I discussed earlier. 
I appreciated the discussion and I appreciated the active and, 
obviously, concerned interest that was expressed by the President at 
the meeting last week.
  I look forward to continuing those discussions. I hope we can do it 
in a spirit of reason and balance and not in a spirit of panic because 
our economy has been stalled and our markets have been essentially 
attacked and have fallen as a result of this shortage in oil supply, 
based on the actions of an oil cartel, OPEC, which hurts the United 
States because of our continuing dependence on foreign oil.
  I yield the floor.
  The PRESIDING OFFICER. The distinguished Senator from Georgia is 
recognized.
  (The remarks of Mr. Cleland, Ms. Mikulski, and Mr. Akaka pertaining 
to the introduction of S. 2218 are located in today's Record under 
``Statements on Introduced Bills and Joint Resolutions.'')
  Mr. CLELAND. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. SESSIONS. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Crapo). Without objection, it is so 
ordered.
  Mr. SESSIONS. I ask unanimous consent to speak as in morning 
business.
  The PRESIDING OFFICER. The Senate is in morning business with 
Senators permitted to speak for up to 10 minutes.
  The Senator may proceed.

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