Gas Prices

Outrageously high oil and gas prices that Vermonters and Americans are paying constitute a national emergency that requires a bold response from the White House and Congress, Senator Bernie Sanders said Thursday. "It is clearly unacceptable that with gas at the pump at $3.50 a gallon and home heating oil outrageously high, the big oil companies like Exxon-Mobil are raking in huge, record-breaking profits and hedge fund managers are making billions speculating on oil futures. Today, senate col

Outrageously high oil and gas prices that Vermonters and Americans are paying constitute a national emergency that requires a bold response from the White House and Congress, Senator Bernie Sanders said Thursday. "It is clearly unacceptable that with gas at the pump at $3.50 a gallon and home heating oil outrageously high, the big oil companies like Exxon-Mobil are raking in huge, record-breaking profits and hedge fund managers are making billions speculating on oil futures. Today, senate colleagues and I demanded that Saudi-Arabia and other OPEC countries stop their collusion, and increase oil production - which should put more oil on the market and lower prices. But this is just one step in terms of what we have to do. Washington has got to step up to the plate and begin protecting American consumers," Sanders said.

Sanders said millions of workers are seeing a steep decline in their standard of living because of high gasoline pump prices. Many older Americans, he added, will not be able to heat their homes next winter unless heating fuel prices are lowered. He also noted that energy costs impact the entire economy, including rising food prices. "While energy prices are soaring," Sanders said, "big oil companies are reporting record profits and speculators at hedge funds and financial institutions are making billions investing in energy futures."

Sanders is working with other senators on both long-term and short-term solutions to the energy crisis which include:

• Imposing a windfall profits tax on the oil and gas industry. Last year, Exxon-Mobil made $40 billion in profits, more than any company in history. Since President Bush has been in office, the five largest U.S. oil companies have made more than $500 billion in profits. Oil companies should be allowed to make a reasonable profit, but anything above that should be significantly taxed. This will take away the incentive of big oil companies to rip-off Americans at the gas pump. It is time that Congress and the President said "No" to the $213 million in campaign contributions that the oil industry has given to them since 1990 and "Yes" to consumers by taking this important step.

• Closing the "Enron Loophole." Energy trading exchanges that were exploited by Enron and continue to be abused by other energy traders who are manipulating the price of oil should be re-regulated. Today hedge funds and speculators are making billions in an unregulated climate by bidding up the price of oil. Some experts believe that speculation is increasing the price of oil by 20 percent to 30 percent.

• Stopping the flow of oil into the Strategic Petroleum Reserve, and immediately releasing oil from this federal stockpile to reduce gas prices. This has worked in the past. When President Clinton released oil from this reserve in 2000, the price of gasoline immediately fell by 14 cents a gallon. When the first President Bush released oil from the reserve in 1991, the price of crude oil dropped by $10 a barrel. The time has come to do this again.

• Breaking up OPEC. OPEC is an illegal price-fixing cartel that is clearly in violation of international free trade rules. The president must file a complaint with the World Trade Organization and demand the dismantling of OPEC. The ending of collusion with regard to oil production will result in increased production and lower oil prices.

• Authorize the president to impose price caps to stabilize prices in the event of market manipulation. Today, the Federal Energy Regulatory Commission has the authority to impose temporary price caps on electricity. When it used this authority to deal with the California energy crisis created by Enron, electricity prices fell dramatically. The president should have similar authority over gas prices.It is clearly unacceptable that with gas at the pump at $3.50 a gallon and home heating oil outrageously high, the big oil companies like Exxon-Mobil are raking in huge, record-breaking profits and hedge fund managers are making billions speculating on oil futures. Today, senate colleagues and I demanded that Saudi-Arabia and other OPEC countries stop their collusion, and increase oil production - which should put more oil on the market and lower prices. But this is just one step in terms of what we have to do. Washington has got to step up to the plate and begin protecting American consumers.

Also on Wednesday, Sanders joined Senator Charles Schumer at a Capitol press conference where they released a letter calling on the Bush administration to use its leverage with the members of the Organization of Petroleum Exporting Countries to increase oil supplies or risk Congress holding up multi-million dollar arms deals with Saudi Arabia, the United Arab Emirates and other OPEC members. As Americans are paying more than ever to fill up their cars at the gas station ($3.50/gallon on average for regular gasoline), it is clear that oil production by OPEC members is below the capacity at which they could be producing. As a result, higher oil prices are affecting U.S. consumers from the gas pump to the grocery store. The Bush Administration has refused to be tough with so-called OPEC allies and in fact continues to provide huge arms deals, despite the economic pains taxpayers are feeling.

To listen to Senator Sanders' discuss this issue, click here.