ENERGY POLICY ACT
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Ms. STABENOW. Mr. President, I want to thank the bill managers, Senator Bingaman and Senator Domenici, for accepting my amendment calling for an investigation by the Federal Trade Commission into gasoline price manipulation and anticompetitive practices by oil companies and refineries. I also want to thank Senator Dorgan and Senator Boxer for their hard work on this issue.
We are living in a time when the average American family has no assurance from week to week that they will be able to afford to fill their vehicle with gas.
Over the past year, gasoline prices have increased by 23 percent. And since December the average price for oil has climbed 40 cents per gallon. To make matters even worse, prices fluctuate wildly from week to week and month to month, making it impossible for families to budget for the cost of gasoline. In fact, I heard from a constituent in Lansing on Monday that gasoline was $2.10 a gallon at 7:30 in the morning and by 9:30 it had jumped over 12 percent to $2.35 a gallon. Gas prices in the Upper Peninsula range from $2.19 to $2.24 a gallon. People in Detroit are paying the highest prices in the State at $2.40 a gallon.
Furthermore, the Energy Information Administration estimates that pump prices for the summer will average about $2.17 per gallon, which is 26 cents per gallon above the price from last year. So what does this mean for the average American family? Using the AAA Trip Calculator I discovered that a family driving their Ford station wagon from Grand Rapids, MI to Washington, DC, would spend $89.82 on gas. These high prices may mean the difference between a family trip to visit grandparents and extended family and staying home. So you see we are talking about real impacts to working families.
At the same time that our families are struggling to find room for the cost of gasoline in their household budgets and canceling their summer vacations, oil companies are chalking up record-breaking profits for the first quarter of this year.
Families are worried about whether or not they can afford the gas to get to work, while oil companies are raking in billions of dollars.
I think my colleagues must agree with me that there is something seriously wrong when American families are struggling to make ends meet and the world's top five petroleum companies are reporting more than $230 billion in profits since 2001.
Furthermore, when we consider that the cost of crude oil makes up less than 50 percent of the total cost of gasoline, there can be no doubt that oil companies and refineries are making their profits off the backs of hardworking Americans.
In a recent CNN/USA Today/Gallup poll, 78 percent of people surveyed said that gasoline prices are not fair.
I agree with them.
There are two ways we can start to lower gasoline prices. One way is to release oil from our National Strategic Petroleum Reserves, which will lower prices by increasing supply while sending a clear signal to OPEC that we are not going to sit back and take whatever they decide to deal. The second is to make sure that no anticompetitive practices are taking place among the big oil companies and oil refineries here in our own country.
My amendment gets to this second point. I have called for an investigation by the Federal Trade Commission into gasoline price manipulation. We need to make sure that American families are not being unfairly taken advantage of by oil companies and refineries.
Should the FTC's investigation find that illegal practices are taking place, they have a couple of options. First, the FTC can pursue a civil action and fine companies breaking the law. Or, if they find evidence of criminal behavior, the FTC can then notify the Department of Justice, which would then pursue criminal action.
We have seen the devastating effects that market manipulation can have when energy companies withheld power from California's power grid in 2000 and 2001 in order to drive up the price of electricity. The result was 38 days of blackouts, rolling brownouts, service interruptions, and ultimately over $11 billion from the California State Treasury. A later report by the California Public Utilities Commission stated that the vast majority of the power failures could have been prevented.
We need to make sure the same kind of intentional market manipulation and preventable economic losses do not happen to American consumers when they buy gasoline.