Bush Called On To Stop Exports, Deal With Exporting In Barton Bill
Santa Monica, CA -- With the U.S. House of Representatives poised to grant new tax and environmental breaks to oil refiners tomorrow, the Foundation for Taxpayer and Consumer Rights (FTCR) warned in a letter to President Bush that oil producers' exporting of heating oil will cause unprecedented price spikes this winter if the Administration does not halt the exports. 1.5 billion more gallons of liquid heating products were exported in the first seven months of 2005 than during the same period in 2004.
FTCR also noted that without regulation of oil producer exports, government subsidies to build new refining capacity could simply result in new product being exported to short the US market and drive up prices.
FTCR President Jamie Court and petroleum industry consultant Tim Hamilton report to the President in a letter today that: "In the first seven months of this year, the oil companies exported over 96 million barrels (4 billion gallons) of fuel oil. The amount is 48 times the volume of the Northeast Heating Oil Reserve. When combined with the propane and natural gas that was also exported, the total export of heating products equates to 58 times the volume held in the entire publicly owned reserve in the United States."
"With winter approaching, oil company exporting has again set the stage for a price spike," Court and Hamilton write. "The consequence could well be an unprecedented increase in the price of residential heating oil, natural gas, and propane. Unlike motorists who have the ability to cut back on driving and gasoline consumption, Americans reliant on these petroleum products to heat their homes face a potentially life-threatening dilemma. As the price of heating oil skyrockets, the only recourse for many on limited or fixed incomes will be turning off their furnaces in the dead of winter. That is why we call upon you to use your executive powers to freeze exports to nations other than Canada."
On Friday the House of Representatives is expected to take up legislation, sponsored by House Energy and Commerce Chairman Joe Barton, giving new tax breaks to oil refiners to increase refinery capacity .
"Without regulation of oil refiners, oil companies can use new tax breaks to create new product that they simply export to drive up prices in the U.S. once again," said FTCR President Jamie Court. "This industry needs a regulatory stick if it is to increase refining capacity and sell the product in the United States of America."
"If Congress does not address the exports problem, the companies will simply pocket tax breaks," said Hamilton. "Any actual increase in production occurring in the U.S. will likely to find its way out of the county and prices will continue to climb."
- 30 -