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MA Delegation to OIl Execs: Match Citgo Heating Oil Discounts

Location: Washington, DC

December 19, 2005

Appeal to Industry's Corporate Citizenship in Context of Projected Winter Profit

WASHINGTON, DC -- As local non-profits launch a statewide heating oil discount program underwritten by CITGO Petroleum, the Massachusetts congressional delegation today challenged other US oil companies to offer similar assistance to low-income Americans this winter.

In a two-page letter, the ten Massachusetts Congressmen appealed to the heads of the eight largest oil companies to demonstrate their corporate citizenship amidst projections of enormous industry profit this winter. Last month, Rep. Bill Delahunt announced a first-in-the-nation plan for CITGO to provide 12 million gallons of home heating oil to low-income families and social service institutions across the Commonwealth. The 40-percent discount amounts to a projected $10 million commitment from CITGO. The program is expected to supply fuel to nearly 50,000 households and hundreds of social service institutions. CITGO is owned by the state oil company of Venezuela.

Excerpts of the letter follow:

Since the discount program was announced, we have received two kinds of responses. Most have commended CITGO for its humanitarian gesture and applauded the creativity of all parties to the contract. In fact, we have been approached over the last week by numerous cities and states interested in exploring similar opportunities. . . However, others have pilloried the program as serving political objectives of the Venezuelan government, the sole shareholder of CITGO, at a time of tense relations between our two Presidents. The talking-point from these quarters is apparently that we were "bought off" by CITGO and the Venezuelan government. Like so many other political talking-points, that allegation is false. The fact is that CITGO was the only oil company willing to provide assistance - help that our region, like many across the United States, would be just as grateful to receive from other American oil companies. And that is why we are writing to you today.

In the past, many have sought your active participation to help ease the relentless financial burden faced by poor residents during the winter - the proverbial choice between food, medicine and heat. In response, the industry's silence has been deafening. The apparent rationale for that reluctance became clearer recently. In testimony on November 9 before the Senate Energy and Natural Resources Committee, one of your industry colleagues stated: "As Americans, we all feel for those who are less fortunate. We want to make sure they get the energy they need. We feel it's not a good precedent for one industry to fund a program as such. We think that's a responsibility of the government."

. . . the federal program which provides winter fuel assistance is woefully underfunded, even as costs may jump 50 percent over last year. We certainly look forward to your working with us to persuade the White House to address this unconscionable shortfall. But that will not help anyone this winter, when millions of Americans who meet the income thresholds for the LIHEAP program will receive no relief at all.

Last month, US Senator Charles Grassley wrote to the American Petroleum Institute, the Independent Petroleum Association of America, and the Natural Gas Supply Association: "You have a responsibility to use these record profits to invest in more exploration, production, and refining capacity to increase the supply of petroleum products. . . a responsibility to help less fortunate Americans cope with the high cost of heating fuels." Sen. Grassley suggested that it is reasonable to expect companies "with 50, 75, or 100 percent growth in earnings this quarter to contribute a mere 10 percent of those profits" to fund fuel programs that supplement the Low Income Heating Energy Assistance Program. "This is especially true," he wrote, "in the case of some of the largest integrated oil and gas companies that currently have tens of billions of dollars in cash on hand."

. . . we again appeal to your sense of corporate citizenship. Especially in this season of record industry profits, please advise us - so that we can inform our congressional colleagues -- what kind of assistance you can lend to low-income Americans attempting to struggle through the next few months.

In addition to Delahunt, the letters were signed by Reps. Ed Markey, Mike Capuano, Barney Frank, Stephen Lynch, Jim McGovern, Marty Meehan, Richard Neal, John Olver and John Tierney. The delegation letters went to the top executives of: ExxonMobil, Chevron, ConocoPhillips, Sunoco, Marathon Oil, Valero Energy, Amerada Hess and Tesoro.

The Venezuelan heating oil program got underway in earnest this week. To explore eligibility for discounts, local families can call (877) 563-4645. Human service groups can call (800) 287-3950.

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