Statements on Introduced Bills and Joint Resolutions

Floor Speech

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS -- (Senate - June 04, 2008)

BREAK IN TRANSCRIPT

By Mr. KERRY:

S. 3081. A bill to establish a Petroleum Industry Antitrust Task Force within the Department of Justice; to the Committee on the Judiciary.

Mr. KERRY. Mr. President, from the skyrocketing price of crude oil, now hovering well above $120 a barrel, to the $4.00 per gallon being sold at gas stations across the country, Americans are frustrated and there appears to be no end in sight.

I've talked to school superintendents who have had to cut academic programs because the cost of fueling school buses has gone through the roof. I have met with constituents who are pleading for the Federal Government to take some kind of action to provide relief. Just last week, I held a field hearing in Pittsfield, Massachusetts to examine how gas prices were impacting small business owners, and the testimony was striking. Businesses that have been sustainable for decades are now wondering whether they'll be forced to shut their doors for good.

Congress has received testimony from energy market experts and major oil company executives that the price of oil and gas can no longer be explained or predicted by normal market dynamics or their historic understanding of supply and demand forces. An executive from Exxon Mobil recently testified before Congress under oath that the price of crude oil should be about $50 to $55 per barrel based on the supply and demand fundamentals he had observed. Yet current crude oil prices are more than double that.

We are all owed a clearer understanding as to why prices are so disconnected from what normal supply and demand would indicate. Why has the price of oil nearly doubled in the last year? Prices should not skyrocket like this in a properly functioning, competitive market. Twice I have written to
the Bush Administration demanding an investigation and twice I have received a response of ``we're working on it''. Well, this response rings awfully hollow to Americans struggling to understand what's going on.

How the Federal Government responds to the changing dynamics of energy markets is vital to our continued national and economic security. If the Enron energy crisis taught us anything it is that consumers are best protected when energy markets are subject to aggressive oversight and enforcement. Unless there is a cop on the beat vigilantly policing energy markets--especially when supplies are tight in markets with extremely inelastic demand--sophisticated companies can fleece consumer pocketbooks without fear of penalty.

Therefore, I am introducing legislation today to establish a new interagency Oil and Gas Market Fraud Task Force under the leadership of the Department of Justice to ensure that energy markets are free from illegal market manipulation or corporate corruption. This legislation will allow us to root out fraud and manipulation in all corners of the oil and gas marketplace, and restore consumer confidence. When that happens, everyone wins. I urge my colleagues to support this legislation.

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