Looking at gasoline prices lately feels like the planet is back down to the last drop again.
“For the last six years, as our families struggled with high prices at the pump, these oil and gas companies have pocketed record profits,” said Congressman Baca (D-CA) in a statement.
Baca said that prices today reflect a 115 percent increase in oil since 2001 under President Bush, and also reflects $125 billion for the “Big Oil Six” companies.
“This is a big blow to working families in the Inland Empire. When the cost of living goes up with record gas prices, families in the Inland Empire are among the first to feel the brunt of it. Our families can’t take this kind of pressure at the pump,” Baca said.
Michael Levin, spokesperson for Baca, said in the last Congress the House passed legislation that would require the Federal Trade Commission to investigate price-gouging and the sharp rise in gasoline prices.
“We’re still very early in the new Congress with energy one of the highest priority issues for the new Democratic majority,” Levin said.
One of the first moves in the first 100 hours for the Democratic Congress was the widely applauded repeal of energy bill tax provisions giveaway to big oil companies of $14 million in subsidies.
Still, everybody keeps asking, exactly why are oil and gas prices so high?
A.) Tight oil supply, although last week’s major OPEC meeting didn’t confirm that. Members said that oil looked sufficient and there’s no need to flood the market with more oil supply.
B.) The popular choice: is the United States dependent on foreign oil?
C.) Astronomical profiteering by big oil companies?
Gasoline prices hovered at $3.00 most of last summer and spring, but before the November election, inexplicably dropped to about $2.25.
Doug Heller, executive director of the Foundation for Taxpayer and Consumer Rights, believes the answer is definitely “C,” adding that there is another important component that is usually overlooked.
To keep prices climbing higher so big oil firms can make more profit, companies have shut down refineries to restrict supply that helps drive up the price.
In some instances, refined fuel has literally been sent out of the country to tighten supply for retailers. Big oil reduced their number and shut down refineries so they’re not producing as much oil as they could.
Tighter supply gives the illusion of less available oil, almost making the buyer at the pump feel that high prices are justifiable.
Suddenly, in October, there was a flood of gasoline on the market.
“Prices were down, profits were down,” said Heller, consumer advocate. “One of the best evidences we’ve seen of manipulation of the gasoline market came in October. Just as we were approaching election season, gasoline prices fell. In fact, they fell pretty dramatically.”
Holding back gas pushes prices up, all the while big oil companies make record profits. One company alone, Exxon, made $40 billion last year in profits. The shame, he adds, is that politicians in Sacramento and Washington continue to buy into the oil industry lie.
There is a dependency on oil itself, regardless of where it comes from, but that’s not what local families are up against trying to get to work, or local truckers trying to make the long haul.
The problem is domestic oil companies cheating the market by withholding supply beyond what is necessary, and reducing refineries, he said. The oil industry has also pushed for legislation to make it harder to open refineries in California because they don’t want a widely available supply.
It’s bad for their bottom line. What’s worse is that the industry’s money interest is what keeps Washington in knots.
“The problem is not our dependency on foreign oil; it’s Washington politicians’ dependence on oil campaign contributions,” he said.
It’s not what’s going on in Venezuela or Iraq, but what’s going on with American oil companies in San Ramon, California and Houston, Texas, he said.
“Until people on Capitol Hill are willing to complain about behavior in corporate boardrooms in Texas and California, all the talk about OPEC and world prices is just blowing smoke,” he said.