Consumer Energy Supply Act of 2008

Floor Speech

CONSUMER ENERGY SUPPLY ACT OF 2008

BREAK IN TRANSCRIPT

Mr. BARROW. Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, gas prices are outrageous and we need to act. Families are hurting and are looking to us to do anything and everything that can help.

There's no silver bullet, but there sure are things we can be doing better. One way is to make better use of our energy feedstocks, use what we ought to use today and save what we need to save for tomorrow.

The goal of this bill, H.R. 6578, the Consumer Energy Supply Act, is simple: to increase the supply of oil in the United States that can be refined into gas. The bill will direct the Department of Energy to release 70 million barrels of light sweet crude oil from the Strategic Petroleum Reserve. The bill requires the sale or exchange of light sweet crude to begin 15 days after enactment and to be completed within 6 months. Under the bill the revenue from the release will go into the SPR petroleum account to purchase more oil so the SPR will end up with more oil than it started out with. The bill will make sure that the SPR level will not fall below 90 percent of the current level during the exchange.

Now, the type of oil that will be released from the SPR is light sweet crude, which is the easiest and the cheapest to turn into gas.

[Time: 13:00]

And the oil that will replace the light oil will be heavy sour crude which happens to be the oil that is best suited to be refined into diesel.

What we need more of in this country is the highest and best use of all of our energy feedstocks. And this bill takes the oil that we pump back into the ground to save for later and puts that oil to its highest and best use right now and replaces that oil with oil whose highest and best use is to be held in reserve for a true national emergency.

This bill makes it easier and cheaper to get this fuel to the market right now while making sure we aren't putting our future needs at risk. We need to use today what is good for today and save for tomorrow what is good for tomorrow. Because our refineries need more oil they can refine quickly to get gas and diesel on the market, this bill gives it to them. Adding heavy sour crude to the SPR in its place will make sure that the SPR will be more effective if a real emergency arises. That is because the heavy oil we will be swapping for light oil can be refined to the diesel fuel needed to power our trucks, our trains and our military needs in times of a true emergency.

In April this year, the acting director for natural resources of the Government Accountability Office, Frank Rusco, gave Congress a detailed report to modernize the Strategic Petroleum Reserve and improve its flexibility and effectiveness. The Department of Energy has completed a study in 2005 which produced similar conclusions. This legislation will ensure that the SPR is more reflective of our Nation's modern refining capacity and that its strategic capabilities are better used while providing more oil available for refining right here in the U.S.

Mr. Speaker, I would like to submit these two documents for the Record.

Mr. Speaker, this bill will ease market tensions. It will help unlock some of the value in the SPR without negatively affecting the overall capacity or our strategic reserve policy. A release from the SPR will also help reduce the effects of market speculation on oil prices by sending the message that Congress is prepared to defend American families and businesses from these corrosive prices. That is what this bill will do. That is why it is a good idea for us to pass it. And that is why I urge my colleagues to vote for the bill.

BREAK IN TRANSCRIPT

Mr. BARROW. Mr. Speaker, I yield myself such time as I may consume.

In the course of this debate, from time to time it has seemed as though folks were talking about this as if this was draw-down authority, as if this was just a pure draw-down from the Strategic Petroleum Reserve. I think it's important to emphasize this is not a draw-down proposal.

This legislation proposes a swap. It proposes a swap for that which is best saved for tomorrow in exchange for that which is best used today. We propose to put in the ground what we should save for tomorrow, and put back into the system what we're getting out of the ground now which is best used today. We should use today what's best for today and save for tomorrow what's best for tomorrow.

Also, much has been made, or rather, little has been made of the fact that this is just 3 1/2 days of national consumption being added into the supply system. Only 1 percent of national consumption is being talked about here.

When Mark Twain was born, he was the 100th person born in the town of Hannibal, Missouri. He said, you know, when I was born, I increased the population of my town by 1 percent. That's more than most folks can say in this world.

Well, by this legislation, we can increase the supply of oil and what we've refined into gas in this country by 1 percent, and that's more than we can say about most of the pieces of legislation that we get to vote on from time to time.

Also, it's important to recognize that this 3 1/2 days, this extra 1 percent, is a far greater percent of the thing on which the world price rests. The world price rests on the very thin margin between daily worldwide production and daily worldwide consumption. What is that margin? That margin is a mere 1 million barrels a day. So we're talking about putting into the system 70 times the world's daily float, the difference between daily production and daily consumption.

That is a very significant factor. It is not only a decent percentage of what we consume; it's a very significant factor of that very thin margin that contributes the most to the runaway cost of gas and oil in the world today.

With that, Mr. Speaker, I wish to commend my colleague from Texas for his conduct and debate.

BREAK IN TRANSCRIPT

Source