[Congressional Record (Bound Edition), Volume 153 (2007), Part 8]
[Senate]
[Pages 11571-11573]
[From the U.S. Government Publishing Office, www.gpo.gov]




                            HIGH GAS PRICES

  Mr. KYL. Mr. President, my two Texas colleagues and I would like to 
talk about the Democratic response to high gas prices. Given the fact I 
believe we have about 12 minutes, we may just have a colloquy instead 
of each giving presentations.
  Let me begin by making a couple of points. The press reported 
yesterday that U.S. average retail gas prices rose to an overall 
alltime high, breaking $3 a gallon. I know I paid $3.04, and this is up 
just about 20 cents a gallon over the last 2 weeks. Every family feels 
this pinch.
  Now, Democrats understand this, and that is why last year--and I know 
because I was going through a campaign at the time--they attempted to 
capitalize on a similar spike in gas prices. They held press 
conferences all across the country pledging to lower gasoline prices.
  Let me read one of the headlines that resulted from this publicity 
blitz from the New York Times. It says: ``Democrats Eager to Exploit 
Anger Over Gas Prices.'' This is an April 21, 2006, article, which 
reported, and I am quoting:

       The recommendations of a memorandum sent by Democrat 
     campaign officials to Democratic candidates include holding a 
     campaign event at a gas station where you call for a real 
     commitment to bringing down gas prices.

  I guess you can say: That was then, this is now. Now that the 
Democrats are in charge, the question is, What have they done about the 
problem they were all too quick to exploit back during the campaign? As 
far as I can tell, the answer to that question is, exactly nothing. In 
fact, they tried to and to some extent did prevent Republicans, when we 
were in control last year, from initiating a series of reforms that 
would have actually done something about the problem and might have 
prevented some of what we see now. We were finally able to get 
legislation passed to open the deep waters off the Gulf of Mexico for 
oil and gas exploration to bring more supply on line--that was a very 
positive development--but when we tried to do other things, we were 
stopped by the Democrats.
  I think it is important for us to challenge our colleagues on the 
other side of the aisle who were very interested in the American public 
having to pay high gas prices back during the campaign last year. Well, 
you are in charge. What have you done about it? The answer, so far, 
appears to me to be, exactly nothing.
  Let me say to my colleague from Texas that I know a lot of our 
problem is because of regulations that inhibit oil refineries from 
improving their capability to refine more oil and gas or building new 
refineries. It is very sensitive to what happens at the refineries. My 
recollection is that there was a recent fire at one of the Texas 
refineries.
  Is it the case that we could do some things--and tried last year to 
do some things--to make it easier from a regulatory standpoint for oil 
refineries to increase their capacity? And isn't this one of the ways 
Republicans have tried to ensure we have a larger supply, which would, 
therefore, reduce the price of gasoline to our consumers?
  Mrs. HUTCHISON. Mr. President, actually, that is absolutely right, 
and I will say to the distinguished Senator from Arizona that is only 
one of the problems we have, and it is the reason my husband walked 
into the house this weekend and said: I just spent $70 filling my gas 
tank; what are you going to do about it? Like every one of us, I am 
sure, who has this same experience, I think we should be doing 
something about it. We should be doing a variety of things about it.
  Senator Kyl specifically asked about the refinery capacity. We are 
very tight on refinery capacity. We did pass legislation in the last 
Congress that would try to ease the regulatory burden and therefore the 
timetable that it takes from either starting a new refinery or adding 
critical capacity in an existing refinery, but the regulations had not 
yet been put out as of a couple of weeks ago.
  One of the refiners in my State that wants to add capacity asked me 
if I would help and at least say to the Department to please issue the 
regulations so they can go forward, knowing they would have the 
guidance to move forward with expansion plans and add more refinery 
capacity.

[[Page 11572]]

  In addition to that, I have to say that one of the things we see 
continuing to be blocked on the other side of the aisle is the ability 
to explore and drill in our own waters. The Department of the Interior, 
just last week, put out a lease-sale proposal in eight areas, including 
the Gulf of Mexico, the Outer Continental Shelf, Virginia, and Alaska.
  In Virginia, the legislature is taking the first steps to 
production--by supporting the exploration of gas. The capability for 
earning money for the treasury of Virginia caused the Virginia 
Legislature to say: Yes, we want to do it, but there has to be a waiver 
of a previous extension of the moratorium in drilling. We're hearing 
signals that the Congress is not going to allow that, even though the 
Legislature of the State of Virginia and the Governor have said they 
want to be able to explore to see what is out there, 50 miles out.
  The people who represent the people of Virginia have seen, as so many 
of our legislatures have, that technology today is not what it was 25 
years ago. You can drill and explore in an environmentally safe way and 
we can do something about the price of gasoline at the pump if we will 
take these kinds of measures. The Department of the Interior is now 
trying to do that. Yet we are seeing already the signs of obstruction 
on the other side of the aisle. So I guess we are going to let these 
prices continue to go up without any regard to what we have in our own 
resources, under our own control, which could alleviate some of this.
  It is not just drilling and production and exploration, either. We 
are also trying to put forward nuclear power, which is the cleanest, 
most efficient form of energy. The French have proven that it can be 
very effective as a clean energy source. Yet we are thwarted from the 
opportunity by the other side of the aisle to explore that avenue, and 
then lawsuits crop up, which have stymied our efforts to increase 
nuclear capacity in our country.
  So I would suggest to my friend from Arizona, or my friend from 
Texas, if we are going to continue to be stopped from using our own 
natural resources and if we are not going to be able to increase our 
refinery capacity, then I think we are looking at the capability for 
countries that have denounced America and said they want the 
destruction of America to, in fact, be able to hurt our economy by 
cutting off the oil supply.
  I would ask my colleagues, what should we do if we are not going to 
have cooperation?
  Mr. KYL. Mr. President, I think my colleague from Texas, Mr. Cornyn, 
can certainly answer that question, but first allow me to make a few 
additional comments.
  News reports suggest that increased gas prices can be linked to 
production shortages at a time of increased demand. More directly, the 
problem can be traced to a continuing lack of refining capacity and 
unexpected outages at the Nation's oil refineries. A series of recent 
outages, largely for maintenance, have reduced the supply of domestic 
gasoline.
  The price of a gallon of oil is still $10 below last year when prices 
spiked: however, demand has increased 2.3 percent from the same period 
last year. Existing refineries are unable to meet the ever-rising 
demand for gasoline. The system also cannot handle unexpected outages, 
for example, the recent fire in Texas. The U.S. saw the strain on 
refinery capacity during Katrina when prices nationwide went up 45 
cents in 1 week due to refinery damage in the region.
  Because of high costs, regulatory redtape, and public opposition, 
refiners haven't built a new facility since 1976--30 years ago. The 
system is under such strain that any outages or disruptions are quickly 
felt in the market in the form of increased prices.
  The lack of domestic refining capacity also increases our reliance on 
foreign sources of refined gasoline. America now imports about a 
million barrels of gasoline every day--that means that about one of 
every ten gallons of gas Americans get at the pump is refined in a 
foreign country.
  Regulations requiring a variety of new regional gasoline blends also 
increase the price and make it difficult to address shortages by moving 
supply from one area of the country to another.
  Last year, Republicans saw the strain on the existing system, and we 
tried to do something about it. We passed legislation that opened new 
areas in the deep waters off the Gulf of Mexico to oil and gas 
exploration to bring more supply on line. Republicans recognize that it 
is in our national security interest to increase domestic supply, 
including ANWR, and reduce our reliance on foreign oil.
  I also introduced legislation to ensure that oil companies pay their 
fair share for the oil and gas they produce from public lands. And I 
introduced legislation to remove the 54 cent import tariff on ethanol, 
to lower the price consumers pay at the pump.
  Republicans also tried to address the lack of domestic refinery 
capacity. We introduced legislation to streamline permitting to build 
new refineries, and we were blocked by Democrats. Republicans 
introduced legislation to incentivize building new refineries, and we 
were blocked by Democrats. Republicans introduced legislation to reduce 
the number of boutique blends of gasoline, and we were blocked by 
Democrats.
  Now the Democrats have to do more than block legislation--they have 
to solve problems.
  The Democrats will talk about price gouging legislation and say that 
is the solution. The FTC looked at this last year after Hurricane 
Katrina and did not find evidence of price gouging. More hearings will 
not reduce the price of a gallon of gasoline since there are already 
laws in place to prosecute price gouging.
  The Democrats will talk about conservation and higher CAFE as well. 
We all support conservation as a long-term solution, but we also need 
to take action to address our near-term problems and reduce our 
reliance on foreign oil. We need to increase domestic production and 
increase our refining capacity.
  The theme that I think we see developing here is that the Democrats 
campaign rhetoric is catching up with them, and now they must prove 
they can govern and solve people's problems. They are 0 for 7 in '07 
with their agenda. Gas prices are only the most recent example of 
failure. We still don't have a comprehensive energy policy. We still 
haven't taken steps to improve health care. Democrats campaigned on big 
ideas, but they are playing small ball.
  The Washington Post wrote in an article this weekend entitled 
``Democrats Momentum is Stalling,'' which stated that: ``Not a single 
priority on the Democrats' agenda has been enacted, and some in the 
party are growing nervous that the `do nothing' tag they slapped on 
Republicans last year could come back to haunt them.'' That was the 
Washington Post, May 5, 2007.
  I hope the Democrats will work with us for real solutions to people's 
problems, including reducing gas prices.
  Mr. CORNYN. Mr. President, I think the senior Senator from Texas is 
exactly right. There are a lot of laws that Congress can pass--we can 
even repeal laws--but we can't repeal the law of supply and demand. The 
only way we are going to see these gas prices come down is to produce 
more supply, as we look for alternative forms of energy. The Senator 
mentioned, obviously, nuclear power, but we are even investing in clean 
coal-burning technology. I think we basically need to look at all 
aspects of the energy issue.
  The Senator from Arizona was exactly correct as well. We have gone 
from a high of 324 refineries in this country down to 132. Because we 
are in a global marketplace for gasoline, which essentially can be 
transported wherever the prices tend to be higher, that is why we have 
seen gas prices in excess of $3 a gallon at the pump.
  I remember well that our colleagues on the other side of the aisle 
last year, when we were in the majority, said they wanted to know what 
the Republican plan was to relieve the pain at the pump. Well, the 
Democrats are in charge now, and we would like to know what their plan 
is. We believe this is something we ought to work on together, on a 
bipartisan basis, to try to

[[Page 11573]]

relieve the pain at the pump being experienced by working men and women 
and families all across this country. The only way we are going to be 
able to do this is on a bipartisan basis, but the Democrats control the 
agenda. The majority leader basically controls the time on the Senate 
floor. We need to know when he plans to bring up some meaningful relief 
for the American consumers to try to bring that price down.
  We need to do this in the short term, the near term, not the long 
term only. We do need nuclear power. We need to do research in the 
biofuels and other alternatives. We need to employ wind energy and 
other clean technologies that will provide for part of our energy 
needs. We haven't discovered a way to make any of those useful to 
operate our vehicles. It is oil, and it is gasoline.
  The only way we are going to be able to provide relief in the near 
term is to increase supply by reducing our dependency on imported 
energy, producing more of it domestically, and relieving some of the 
regulatory impediments which have made it impossible to create a new 
refinery in this country in the last 30 years. Only by increasing the 
supply in the near term are we going to be able to see prices come down 
at the pump as we continue to explore alternative forms of energy and 
other ways to meet our energy needs, while continuing to see our 
economy grow and continue to create jobs.
  I hope the majority will take this request seriously and will come 
back and tell us what their plan is to relieve the pain at the pump 
American consumers are experiencing today.
  Mr. President, I yield the floor, and I suggest the absence of a 
quorum.
  The ACTING PRESIDENT pro tempore. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. SPECTER. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.

                          ____________________