Bush Takes AIm at Gas prices

[Intrepidation]

By Steve Holland 2 hours, 20 minutes ago

WASHINGTON (Reuters) -

President George W. Bush, in trouble over soaring gasoline prices, ordered a probe on Tuesday into any price gouging, called for an end to tax breaks for Big Oil and suspended putting oil into the U.S. emergency stockpile.

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As a short-term measure, Bush also gave the

Environmental Protection Agency authority to suspend federal clean-burning gasoline rules this summer that are forcing consumers to buy expensive new gasoline blends.

Bush was acting to reverse prices that have soared above $3 a gallon in many parts of the country and are contributing to a new low of 32 percent in his job approval rating, according to a CNN poll.

Bush, trying to stave off a potential election-year problem for Republicans eager to hang on to control of the U.S. Congress, acknowledged Americans are in for tough times during the summer driving season.

"Energy experts predict gas prices are going to remain high throughout the summer. And that's going to be a continued strain on the American people," he told the Renewable Fuels Association, a group advocating expanded use of ethanol as an alternative fuel source.

Bush said the Justice Department and the Federal Trade Commission had urged state attorneys general to vigorously enforce laws against price gouging and illegal manipulation that may have contributed to rising gasoline prices.

Red Cavaney, president of the American Petroleum Institute trade group that represents oil companies, said its members would cooperate.

But he noted prior investigations had come up empty and predicted the industry will be "exonerated in any of these claims of anti-competitive or collusive behavior."

PAY BACK OIL LOANS

Bush also gave U.S. oil companies more time to pay back emergency loans from the Strategic Petroleum Reserve to put more oil on the market, saying the reserve was sufficiently large that further deposits were not needed until the fall.

The amount of remaining oil that was scheduled to be delivered to the reserve was 2.1 million barrels in May, which would supply about two hours of the average 21 million barrels of oil the United States consumes each day.

"Every little bit helps," Bush said.

Mark Williams, a Boston University professor and expert on energy industry risk management, called the move "political window dressing and a drop in the proverbial oil bucket."

A former Texas oil man who in recent months has advocated curing America of its addiction to oil, Bush was unusually blunt with oil companies enjoying record profits. Exxon had $36 billion in profits last year and gave a $400 million retirement package to ex-chief Lee Raymond.

He said they should use some of their largesse to invest in new refineries and researching alternative fuel sources. The fact that no new refineries have been built in 30 years is frequently cited as a reason contributing to soaring gas prices.

Bush called on Congress to take away from the oil companies about $2 billion in tax breaks over 10 years, such as subsidizing research into deepwater drilling.

Bush had signed the tax breaks into law as part of a comprehensive energy bill last summer. He said the tax breaks are now unnecessary at a time of "record oil prices and large cash flows."

"Taxpayers don't need to be paying for certain of these expenses on behalf of the energy companies," Bush said.

Massachusetts Democratic Sen.

John Kerry took Bush up on the offer, saying he would introduce legislation on Tuesday to repeal the tax breaks and that he hoped Bush was sincere.

"For a moment,

President Bush finally stopped talking like an oil company executive," Kerry said.

Senate Minority Leader Harry Reid, a Nevada Democrat, called for Americans to have a 60-day holiday from the federal gas tax of 18.4 cents a gallon, paid for by the $2 billion in reduced oil company tax breaks.

(Additional reporting by Tom Doggett, Chris Baltimore and Patricia Wilson)

Link: http://news.yahoo.com/s/nm/20060426/ts_nm/...wam4yBHNlYwNmYw

I'm sorry but this pisses me off. The guy tells the Domestics (not the imports) they have to be more fficient and come up with all kinds of gas saving technolgy, isn't willing to help fund them, even though any moron would know GM and Ford hardly have the resources to develope these things quickly. Then he goes on about how he wants American to be free of oil. Then like thehypocriticaly douchebag he is, he waver the environmental law that require the gas to burn cleaner in the summer. Why? Simply because his failure to stop the oil companies from jacking up prices so much has many people loosing favor with him. So in a pitiful attempt to make himself and the Republican party look better, he tries to lower prices by wavering that. I'm not an environmental nut, but it does piss me off that he is doing this instead of actually investigateing the companies sooner, and that he slapped the domestics with all kinds of new demands for cleaner emmisions, fuel efficiency, and alternative fuels, thenturns around and does this.

And let's see, Exxon made record profits, which proves my point that they jacked up their prices just to make more money. Thank you and goodnight.

[Drew Dowdell]

The amount of remaining oil that was scheduled to be delivered to the reserve was 2.1 million barrels in May, which would supply about two hours of the average 21 million barrels of oil the United States consumes each day.

this isn't even rearranging the deck chairs on the Titanic...

[Snate]

It amazes me that Big Oil is getting any sort of tax break.

[Flybrian]

$16 billion in tax breaks and aid. For what? 120 billion some-odd in profit.

[sciguy_0504]

1) The President and Congress have NO control over the real price of oil and gas. They can lower gas taxes, that's about it.

2) The Dems will attack the Republicans on this issue to get elected in November but, again, they will not be able to do anything.

3) Taxing oil company profits at 50% is just giving them ammo to use in a PR campaign to defend high gas prices. The public does not like high taxes.

4) Oil companies, for the most part, DO NOT set the price of oil, the STOCK MARKET does. Oil is a commodity, like gold, and it is sold and purchased like a stock. When a stock becomes popular its price goes up. Why do you think Google's stock price is $300-some a share? People want it! People want to buy oil shares because the price keeps going up and you can make money off of it. Buy at $65, sell at $75, you made yourself $10 per share of oil your purchased. Could oil companies be using investors to make them money? Sure and that is why the president authorized the investigations into price manipulation.

5) Tax breaks for oil companies are rediculous and should be stopped.

[Satty]

With a 30-something percent approval rating, Bush had to do something that made him look good, even if it was just a bunch of bull$h!.

[CARBIZ]

If politicians want to do something meaningful, they should get the environmentalists and NIMBY (Not In My Back Yard) people on the same page to enable new refineries and natural gas ports to be built.

Katrina showed how vulnerable America is to one hurricane with most of its refinery capacity on one stretch of beach! Even with current political issues in Africa and elsewhere, the real choke point is refinery capacity.

Here, the environmentalists play right into Big Oil's hands by delaying for decades the construction of any new refinery that keeps gasoline and heating oil prices up, too.

[Snate]

If politicians want to do something meaningful, they should get the environmentalists and NIMBY (Not In My Back Yard) people on the same page to enable new refineries and natural gas ports to be built.

Exactly what incentive do oil companies have to build new refineries?

[CARBIZ]

That's the problem: if you were CEO of Exxon, would you be willing to spend a billion dollars to build a new refinery if you knew the moment it opened the price of your product would fall? I think not. This is where the environmentalists come in - they delay and block the oil companies at every turn. All the oil companies can do is throw up their hands and say, "Sorry, we CAN'T build a new plant."

As far as Bush is concerned, he may not be able to do anything about the price of the oil coming out of the ground in Saudi Arabia or Sudan, but something can be done to free up competition at the refinery/retail end.

I mean, can you imagine if all the grocery stores in your town put the price of milk and bread up in the morning (by 50 cents a loaf!) and then down at night when mothers are in bed already?

Crazy.

[Intrepidation]

global demand is whatt will kepp prices up...as long as india and china will pay top dollar we dont have a choice.

they need it just as much if not more and prices reflect that trend.

conservation and alternative fuels are the only thing that will keep that at bay.

conserving especially...imagine if everyone saved a little bit...put that trip to the gas station off one or two days....supply lasts longer, less deliveries....it starts to back up....it could help.

dont look for help from the government on this one...not this one anyway,...bush is full of it.  hes an oilman...his pals are too. 

theres no reason to dissaude that.  you know where his interests lie...or lay?  i prefer lie....

its no different than those tax cuts...for him, and his friends.  the wealthy.  and uber wealthy. 

its no different than those "grade school promises "if elected" "  speaches"

except...now  its everyone in this country that isnt georges friend that gets burned.

yep, he's an oilman, and a jackass, and an idiot.

[ShadowDog]

Yeah, I laughed like a little school boy when I read that article. The most they can hope to accomplish is to ... hmm, uh, what exactly do they hope to accomplish?

[Mr.Krinkle]

yeah, and what else is new?

[thegriffon]

With a 30-something percent approval rating, Bush had to do something that made him look good, even if it was just a bunch of bull$h!.

Bush doesn't have to worry about his approval rating, it's not as if he can be re-elected, and other Republicans can be as critical as they like and boost their own standing.

[cmattson]

4) Oil companies, for the most part, DO NOT set the price of oil, the STOCK MARKET does. Oil is a commodity, like gold, and it is sold and purchased like a stock. When a stock becomes popular its price goes up. Why do you think Google's stock price is $300-some a share? People want it! People want to buy oil shares because the price keeps going up and you can make money off of it. Buy at $65, sell at $75, you made yourself $10 per share of oil your purchased. Could oil companies be using investors to make them money? Sure and that is why the president authorized the investigations into price manipulation.

I absolutely agree - to a point. Oil was selling for $45-$50/barrel when Bush took office. Gas prices were $1.40/gallon. Price for a barrel of oil was roughly $70-$75 - about a 50% increase - but gas prices have went up 100-125% (to around $3.00/gallon). So, no question, speculation (helped by Iraq/Iran war tension) have driven prices higher - but not high enough to justify our pump prices - which is why you need to question whether oil companies are deliberately limiting their importing/refining efforts.. think something along the lines of what Enron did to California.

[evok]

1) The President and Congress have NO control over the real price of oil and gas.  They can lower gas taxes, that's about it.

Let us be fare:

Decreased production in Iraq compared to pre-2003 levels. I wonder why?

General instability in the middle east including escalating tension with Iran. I wonder why?

Oh yes - our government may not be able to control global demand, control a diminishing natural resourse but in many ways they have contributed to the rise of crude.

[evok]

Bush doesn't have to worry about his approval rating, it's not as if he can be re-elected, and other Republicans can be as critical as they like and boost their own standing.

Oh he has to worry because of the theory of trickle down popularity. Bush's approval ratings track pretty well with oil prices. With his approval ratings in the toilet and the price of gas being a big part of it, if the Rebulicans loose congress, Bush will be blamed. Oh, he has one more election to go. He is the figurative head of the party.

[evok]

I absolutely agree - to a point.  Oil was selling for $45-$50/barrel when Bush took office.  Gas prices were $1.40/gallon.  Price for a barrel of oil was roughly $70-$75 - about a 50% increase - but gas prices have went up 100-125% (to around $3.00/gallon).  So, no question, speculation (helped by Iraq/Iran war tension) have driven prices higher - but not high enough to justify our pump prices - which is why you need to question whether oil companies are deliberately limiting their importing/refining efforts.. think something along the lines of what Enron did to California.

http://money.cnn.com/2001/05/02/economy/oil/

Crude was trading closer to $30/barrel in 2001.