Schumer says its time to “keep an eye” on big oil
WASHINGTON – If comparing economic models, American oil companies would look more like the trusts Teddy Roosevelt fought to break apart than the free-market competitors envisioned by Adam Smith, claims U.S. Senator Charles Schumer (D-NY).
Schumer said Wednesday that based on recent economic studies he believes it’s “likely” – although not proven – that big oil has been “dialing” back domestic gasoline production and neglecting refinery maintenance in an effort to keep fuel supplies tight and pump prices high.
“There’s a theory that is extra troubling,” he said. “That oil companies are happy to keep oil supplies low to drive prices up. That is befuddling.”
“It hurts us as a country,” Schumer went on, citing the America’s resulting dependence on foreign gas imports, and the burden high fuel prices place on the U.S. consumers and thus the retail economy. “A billion dollars leaves our country a day and goes to a lot of places we don’t like, like Iran.”
According to the U.S. Energy Information Administration, the U.S. gasoline supply has been on a record 12-week slide while demand has increased 100,000 more barrels per day than last year. The EIA claims slowed imports and refinery outages – caused by equipment breakdowns, fires, and explosions – have mainly been the cause.
“We have to do something about the high cost of gas,” said Norwich resident JoAnne Baker as she was filling her tank Tuesday afternoon.
Currently, the EIA says the only way consumers will see prices get below $3 per gallon – which is where it’s expected to hover throughout the summer – is if they can reduce demand by reducing how much they use.
“In a small town I’m not sure it will make a difference,” Baker said. “I think people here do conserve. I think people here do walk.”
As the high gas prices plague wallets, Schumer attributes much of the problem to long-standing bi-partisan political allegiance to big oil, which has ultimately allowed – through mergers and royalty payments – for a lack of competition among America’s gas suppliers – BP, Exxon-Mobil, Chevron-Texaco, and Shell – which have gone from 15 to four since the 1980s. Admitting it won’t be an easy undertaking, the senator, touting a “new” Congress and Senate, said he plans to start “trust-busting” discussions related to big oil next month in the Joint Economic Committee he chairs.
“This deserves a serious look,” Schumer said. “When you don’t have competition, you don’t have lower prices.”
The number of outdated U.S. oil refineries – no new facilities have been built in the last 10 years – and their neglected maintenance are also major issues the senator plans to bring before the Government Accountability Office next month; guided by this question, “Are oil companies under-investing to keep the market tight?”
Legislation to amend mileage standards in vehicles by 2020 and increase the Federal Trade Commission’s authority to investigate price gouging are all in the works, Schumer said.
Today’s national average per gallon is $3.114. New York state’s average is $3.159 and the price in Binghamton is $3.029.
Exxon-Mobil, the largest publicly traded company in the world, earned $39.5 billion in 2006.
Schumer said Wednesday that based on recent economic studies he believes it’s “likely” – although not proven – that big oil has been “dialing” back domestic gasoline production and neglecting refinery maintenance in an effort to keep fuel supplies tight and pump prices high.
“There’s a theory that is extra troubling,” he said. “That oil companies are happy to keep oil supplies low to drive prices up. That is befuddling.”
“It hurts us as a country,” Schumer went on, citing the America’s resulting dependence on foreign gas imports, and the burden high fuel prices place on the U.S. consumers and thus the retail economy. “A billion dollars leaves our country a day and goes to a lot of places we don’t like, like Iran.”
According to the U.S. Energy Information Administration, the U.S. gasoline supply has been on a record 12-week slide while demand has increased 100,000 more barrels per day than last year. The EIA claims slowed imports and refinery outages – caused by equipment breakdowns, fires, and explosions – have mainly been the cause.
“We have to do something about the high cost of gas,” said Norwich resident JoAnne Baker as she was filling her tank Tuesday afternoon.
Currently, the EIA says the only way consumers will see prices get below $3 per gallon – which is where it’s expected to hover throughout the summer – is if they can reduce demand by reducing how much they use.
“In a small town I’m not sure it will make a difference,” Baker said. “I think people here do conserve. I think people here do walk.”
As the high gas prices plague wallets, Schumer attributes much of the problem to long-standing bi-partisan political allegiance to big oil, which has ultimately allowed – through mergers and royalty payments – for a lack of competition among America’s gas suppliers – BP, Exxon-Mobil, Chevron-Texaco, and Shell – which have gone from 15 to four since the 1980s. Admitting it won’t be an easy undertaking, the senator, touting a “new” Congress and Senate, said he plans to start “trust-busting” discussions related to big oil next month in the Joint Economic Committee he chairs.
“This deserves a serious look,” Schumer said. “When you don’t have competition, you don’t have lower prices.”
The number of outdated U.S. oil refineries – no new facilities have been built in the last 10 years – and their neglected maintenance are also major issues the senator plans to bring before the Government Accountability Office next month; guided by this question, “Are oil companies under-investing to keep the market tight?”
Legislation to amend mileage standards in vehicles by 2020 and increase the Federal Trade Commission’s authority to investigate price gouging are all in the works, Schumer said.
Today’s national average per gallon is $3.114. New York state’s average is $3.159 and the price in Binghamton is $3.029.
Exxon-Mobil, the largest publicly traded company in the world, earned $39.5 billion in 2006.
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