Heated Fuel Price Rhetoric
Rising fuel prices are rattling a lot of people who want action, fast.
Sen. Dick Durbin (D-IL) has sent a letter to the Chairman of the
Federal Trade Commission (FTC), asking for an investigation into the
recent spike in diesel and jet fuel prices. A consumer group —
Consumer Watchdog — is lambasting President Bush for not taking action
to reduce prices. And, as we noted yesterday, House Speaker Nancy
Pelosi (D-CA) is also knocking on the White House door seeking support
for her strategy to bring prices down.
In his April 23 letter to FTC chairman William E. Kovacic, Durbin
raises alarms because, nationally, diesel prices are at an all time
high while airlines are faced with a growing gap between the cost of
crude oil and the price they pay for retail jet fuel. He writes:
"Higher diesel and jet fuel prices are affecting millions of American
consumers and businesses. When the market experiences unexplained
spikes in energy prices, the American public deserves strong oversight
and investigation from the FTC. I urge the FTC to undertake a
comprehensive investigation of oil and gas markets to gain a better
understanding of the current price spikes and widening gaps in diesel
and jet fuels prices."
And Judy Dugan of the nonprofit, nonpartisan Consumer Watchdog, based
in Santa Monica, CA, complains in an article that Bush is doing less
today than he did in 2006 to help address the problem. Dugan notes that
in April 2006, the national average pump price was a "mere’" $2.96 a
gallon for regular and $2.88 for diesel, according to federal Energy
Information Administration figures, and the White House treated it as
an emergency.
Today, with national gasoline prices over two weeks rising to more than
$3.50 a gallon on average, the crisis is far worse. It "is busting
family budgets and threatening a further downward spiral in the
economy," yet the White House isn’t taking action, Dugan writes, and
calls for some specific actions, including these:
– Stop using taxpayer funds to add to the Strategic Petroleum Reserve,
which is still growing at a rate of 1.5 million gallons a month and is
at near-record highs above 700 million gallons total. President Bush
should also release oil from the reserve into the market, to help quell
speculative price spikes. Dugan points out that Bush actually advocated
quelling SPR purchases in 2006 when gasoline flirted with the $3 mark.
– Close the Enron Loophole in commodity trading regulation. A
regulatory measure in the federal farm bill (S.2058 by Sens. Dianne
Feinstein and Carl Levin) would help stop speculative oil pricing.
– Increase the amount of margin funds that traders must put up in energy markets to help suppress speculation.
Clearly, the price of fuel is causing agitation. And once the
connection is made more strongly between rising fuel costs — not just
biofuels — and the growing food crisis, expect the fuel-price issue to
take on an even greater urgency.