Whitfield's Subcommittee To Investigate High Gas Prices

Press Release

Whitfield's Subcommittee To Investigate High Gas Prices

U.S. Rep. Ed Whitfield, Chairman of the Energy and Commerce Subcommittee on Oversight and Investigations, announced today that the Subcommittee will begin an inquiry into oil refining capacity and oil company profits in response to the recent escalation of gasoline prices. Whitfield is taking this action at the request of U.S. Rep. Joe Barton (R-TX), Chairman of the full Energy and Commerce Committee, who spoke out earlier in the day asking for an immediate inquiry by the Subcommittee.

Like many Americans, I am deeply concerned about the rapid rise in gas prices, especially when oil companies are reporting record profits and company executives are receiving multi-million dollar retirement packages, said Whitfield. "Rising energy prices are a direct threat to Americans already strained budgets and the long-term growth of our economy.

Last year, ExxonMobil recorded the largest profit on record for an American corporation, reporting earnings of nearly $36.1 billion for 2005. Despite record profits at ExxonMobil and high profit margins at other oil companies, investments in oil refining capacity have not kept pace with rising consumer demand. For nearly 30 years, no new oil refineries have been built in the United States. Of the domestic refineries currently in operation, many are dedicated to producing high-priced boutique fuels for states that have higher Clean Air Standards than those required by the federal government.

Many other factors are contributing to high gas prices, including the high price of crude oil. Oil prices recently exceeded $70 per barrel on the world market, nearly $20 more per barrel traded one year ago at this time. Geopolitical uncertainties have contributed to these rising prices, including ongoing tensions in Iran, Nigeria, and Venezuela. In addition, the rapid industrialization of China and India has caused a spike in demand for crude oil, depleting already short worldwide inventories.

Efforts are underway to lessen Americas dependence on foreign oil sources. Last month, the Administration released a final rule raising the Corporate Average Fuel Economy standards to for sport-utility vehicles, minivans, and trucks to 24 miles per gallon, up from 21.6 miles per gallon. The Administration estimates that the increase, which is set to be in place for all 2008 model year light-truck vehicles, will save approximately 10.7 billion gallons of fuel through 2011. In addition, ethanol and biodiesel producers, including many in the First District, are helping to develop cost-effective energy sources that can be produced domestically and which can serve as an alternative to foreign oil.

It is imperative to address the shortfall in oil supplies, but in the longer run, we must begin to look alternative sources of energy like ethanol and biodiesel that can sustain our way of life, said Whitfield. I look forward to working with Chairman Barton in examining these issues.

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