Washington, D.C. – Responding to the rising costs of fuel and the financial pinch that America’s families are feeling across the country, U.S. Rep. Mark Udall, D-Eldorado Springs, announced a plan that includes both short-term relief for consumers, and a long-term approach to combat the rise in fuel prices -- energy costs that are not only hitting gasoline consumers, but also driving up the cost of food and hurting Colorado families in other ways.
“Americans across the country are paying the price at the pump and it hurts,” said Rep. Udall. “It hurts our families when parents have to pay more money to drive their kids to school, drive to work, and pay more for the food at their dinner table.
“Last week the President said that if he could ‘wave a magic wand’ to lower gas prices he would. This shows once again that he is not only unwilling to be accountable to the American people but that he is also completely out of touch with the real needs of Americans who are struggling to make ends meet during this economic downturn. It is largely because of this Administration’s failed policies at home and abroad that hard-working Coloradans are paying record prices while oil companies continue to log record profits. This President might want to stay this same failed course, but it is wrong and it needs to change. That is why I’m offering a responsible and carefully crafted plan-- free of gimmicks-- that can help lower gas prices and offer consumers some relief.
“Our number one priority should be to immediately call for a temporary halt of purchases for the Strategic Petroleum Reserve(SPR). Putting a stop to the filling of the SPR can make a real difference for Coloradans at the pump and we should take this step now – before summer arrives. In 2000, this action brought the price of oil down by one-third – from $30 to $20 per barrel. When the United States signals its intention to act in this way, the market has historically responded in a manner favorable to consumers.”
Suspending the stockpile of oil for the SPR is part of a six-point plan Udall is pushing that will lower gas prices, protect consumers and help redirect America’s economy. The plan includes both immediate market relief and long term, necessary changes:
IMMEDIATE MARKET RELIEF:
Suspend stockpiling oil in the SPR (H.R. 5473)
In 2004, Goldman Sachs estimated that filling the SPR raised oil prices by as much as 25 cents a gallon - when gas prices were much lower than they are today. Udall is cosponsoring a bill to limit America’s contributions to the SPR when gas prices are high. Later this month, Udall will again join several colleagues in writing to President Bush, urging him to order a temporary suspension of SPR purchases to help lower demand.
LONG-TERM, NECESSARY CHANGES:
Crack Down on price gouging (H.R. 594)
Speculators have contributed to oil prices increasing 82 percent in the last year. While these have been regulated markets in the past, more and more new investment tools are outside of regulation by the Commodity Futures Trading Commission (CFTC) or any other federal government oversight. Udall is backing a bill to give the CFTC oversight over additional energy commodities trading and to establish civil and criminal penalties for price gouging.
Consider Suspension of the tariff on ethanol imports
Rep. Udall is looking into ways to temporarily suspend the 54-cent-per-gallon ethanol import tariff, to support more ethanol coming into the country, increasing fuel supplies and lessening the pressure on prices.
Stop subsidizing the oil and gas industry
The Republican Congress passed an energy bill in 2005 that included about $2.6 billion in tax cuts for the oil and gas industry – an industry that has seen record profits in the last few years. Udall strongly supports removing some of the unneeded tax credits for this industry, specifically the tax credit for taxes paid to foreign governments and the deduction for domestic manufacturing activities for major oil and gas producers.
Increase oil and gas drilling in certain areas
Rep. Udall supports expanding exploration and development in appropriate areas both onshore and offshore, as long as it is done in a sustainable and environmentally sound manner. He also supports a bill cosponsored by U.S. Rep. Jeff Flake, R-AZ, that relaxes the current embargo that prevents U.S. oil companies from competing to develop oil offshore from Cuba, where companies from other countries are currently drilling (H.R. 3182).
Push renewable energy alternatives – promote cellulosic ethanol and the Production Tax Credit
Increasing America’s use of renewable energy sources will also help address supply in future years by providing a more diverse energy portfolio. Cellulosic ethanol has great potential to not only lower our gas prices, but also our food prices as we move away from corn-based ethanol. Udall has been a strong supporter of this critical R&D, much of it done in Colorado at the National Renewable Energy Lab.
“Increasing our renewable energy use won’t solve all of our country’s energy problems, but in Colorado we have the wind, the sun, and the brain power to be a national leader in this area,” said Udall. “My set of proposals, taken together, provide a common sense path to reducing pain at the pump today and moving our country further toward increased energy independence. First and foremost we need to suspend filling the SPR – that is the one action that will most help consumers today and I urge the President to take this critical step.”
To contact the Udall press office, call Tara Trujillo at 720-333-3425 or Heather Fox at 303-725-6595.