[Congressional Record (Bound Edition), Volume 150 (2004), Part 4]
[Senate]
[Pages 5437-5438]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           RISING GAS PRICES

  Mr. WYDEN. Mr. President, I rise to reiterate how important it is 
that Congress and the administration act to protect the American people 
from rising gas prices. I call on the Bush administration to stop its 
campaign of inaction on this critical consumer issue.
  This week the Organization of Petroleum Exporting Countries, OPEC, 
will vote on whether to cut their cartel's production by 1 million 
barrels a day. This vote comes at a time when the American Automobile 
Association tells us that the national average price of gasoline is the 
highest it has ever been. Of course, we know it is not yet the peak 
driving season. In California, consumers consistently pay over $2 a 
gallon. In my home State, it is $1.80, and in some towns, $1.85, such 
as Eugene and Medford. Consumers in Oregon are getting clobbered.
  The vote OPEC will be making comes at a time when according to the 
Associated Press private gasoline inventories are already down by 2.5 
million barrels. The vote comes at a time when, in spite of these very 
low supplies, the Bush administration stubbornly persists in filling 
the Strategic Petroleum Reserve instead of steps that I and others 
favor, which are to put more oil on the market.
  In my view, it is imperative that the United States push OPEC in 
every possible way not to cause further harm to our already injured 
gasoline market and to vote against any further production cuts. The 
Lundberg Survey tells us that even if OPEC were to agree this week not 
to cut production, we would still face skyrocketing prices. Here is how 
I read that: If OPEC doesn't agree not to cut production, the problem 
will be that much worse.
  When oil prices were high in September of 2000, then-candidate George 
W. Bush blasted former President Clinton for not pushing OPEC to 
increase production. Prices at that time were not as high as they are 
today. And at least the administration at that time was making some 
efforts to wring some relief out of OPEC. But still then Texas Governor 
Bush said:

       We need to be mindful of the power of strong and consistent 
     diplomacy. We need to start playing with chips we have earned 
     in the past on behalf of American consumers.

  If anybody has chips to play now in order to get a fair shake for the 
consumer, it is this President. Certainly he has chips to play with the 
domestic oil producers who enjoy the tax breaks he favors and 
environmental breaks and help when those companies are having 
difficulty supplying their refineries.
  With regard to the OPEC vote, we ought to be clear. I hope the 
President of the United States will follow the advice he gave years 
ago. I hope he will do everything possible to push those

[[Page 5438]]

OPEC countries now, telling them they should not allow the gas problem 
in this country to worsen with yet another production cut. Pushing OPEC 
to stop a planned production cut is the very least this administration 
could do for the gasoline consumer. It would be the least that could be 
done, but at least it would be something. At least it would end the 
weeks' long, months' long campaign of inaction that this administration 
has waged as gasoline prices have crept higher and higher and clobbered 
consumers in every part of the United States.
  For several weeks now OPEC's per barrel price has been well above 
their target per barrel price range of $22 to $28. OPEC committed to 
keeping prices in this range. They long ago discarded that commitment, 
and yet nobody has heard anything from the administration until just in 
the last week or so, as I and others started calling for answers.
  We sure heard from the White House last week when OPEC prices dropped 
to $35.51 per barrel. They said: Well, we are making progress. But the 
fact is, that amount is more than $7 higher than the top of OPEC's 
target price range. So any pressure this administration has put on OPEC 
is a day late and more than $7 short. Taking credit after the fact for 
a pittance of accommodation from OPEC is not going to solve this 
Nation's gasoline price problems, and it certainly is not going to 
provide the consumer any real relief.
  I will tell you what else is not going to help American consumers. 
That is for the administration to continue to turn a blind eye to the 
rampant anticompetitive and anticonsumer practices that are plaguing 
our country's gasoline markets. Scores of communities, including those 
in my State, have few if any choices for the gasoline consumer. 
Nationwide the gas market in Oregon and at least 27 other States is 
considered tight oligopolies where four companies control more than 60 
percent of the gasoline at the pump. In these tightly concentrated 
markets, numerous studies have found oil company practices have driven 
the independent wholesalers and detailers completely out of the market. 
They use red lining and zone pricing. The fact is, with these and other 
practices, the independent stations can't compete. They go out of 
business, and the oil companies can widen their net to grab even more 
cash from the consumers.
  The Federal Trade Commission, when they have looked at these 
practices in the past, have admitted that they are anticompetitive and 
drive prices higher. They just say they don't have the power to do much 
about it. I don't think that is true. To be fair, the past 
administration didn't do a whole lot either when it came to going to 
bat for the consumer to stop these oil company anticompetitive 
practices. But this administration has proven that if they want to make 
something happen administratively, they certainly can do it. They have 
done that in area after area.
  It seems to me that if the administration will end its campaign of 
inaction to stop the price-pumping shenanigans of private oil 
companies, they could certainly take steps now to help the American 
consumer.
  In December of 2002, they stepped in to stop filling the Strategic 
Petroleum Reserve to keep more oil on the market, when the oil 
companies couldn't keep their refineries full. But now when American 
consumers are paying $2 a gallon at the pump, we don't see any effort 
to stop filling the Strategic Petroleum Reserve. So the fact is, what 
this administration is unwilling do for the driving public, they are 
willing to do for big oil.
  What ought to be done in the face of this campaign of inaction? 
Certainly, you can make a start by having congressional action. I 
sponsored S. 1737, which would give the Federal Trade Commission 
additional tools to promote competition in these very tight markets. 
They would have the power to issue cease and desist orders to prevent 
companies from gouging consumers. That is a vehicle that can be used 
right now to help the American consumer. We are certainly going to have 
problems in the days ahead. And even the oil companies admit that the 
market won't solve the problems on its own.
  Last August a report by the Rand Corporation revealed that even oil 
industry officials are predicting more price volatility in the future. 
Last November the Energy Information Administration also issued a 
report on the causes of last summer's record high gas prices.
  They said--and this is the position of the Federal Government--
``There is continuing vulnerability to future gasoline price spikes.''
  The Congress needs to act now before gasoline rises to $3 per gallon, 
and we are hearing that from some independent oil industry analysts.
  The administration, however, has the power to act now. They need to 
be on the phone. They need to be pushing OPEC today. They need to get 
off the dime at the Federal Trade Commission, where action can be taken 
administratively. Rising gas prices don't just hit families in the 
pocket during the weekly fill-up; those rising gasoline prices are 
producing a disturbance and causing ripples throughout our economy. 
There are huge consequences of this price manipulation.
  When gasoline costs more, businesses' transportation costs go up. 
Their profits go down. So either the price of the goods they sell to 
consumers has to go up, or the number of people they employ must 
plummet. So higher gas prices either mean bigger costs for consumer 
goods, or fewer jobs in an economy that certainly cannot afford to lose 
any more.
  Let me close by saying that I hope my legislation, S. 1737, will pass 
in the days ahead. Right now, consumers are getting socked at the pumps 
in person. That is not acceptable to me and should not be acceptable to 
any Member of the Senate. It is time to stand up to the status quo.
  It is time for the Bush administration to take the lead. They ought 
to do it with OPEC and with the Federal Trade Commission. If the 
administration doesn't support the proposals I offer today, they ought 
to end their campaign of inaction and offer their own. I hope we will 
have a chance to debate this on the floor of the Senate.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from North Dakota is recognized.

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