As gas prices nationwide exceed $4 a gallon, the U.S. Senate held a cloture vote today on a motion to move forward with legislation that takes aim at oil companies and removes their egregious subsidies that are superfluous in the context of $135 per barrel oil.  The vote, which I supported, was unsuccessful, and once again, an opportunity was lost to address the current energy crisis.  This while the five biggest oil companies earned a record $123 billion in profits last year and have earned $36 billion in the first three months of this year.

Empty rhetoric has no role here.  Working families are struggling to cope with the astronomical costs of oil and gas, all the while, Congress has yet to coalesce around a solution.  While the oil and gas industry enjoy record profits, the rest of America is forced to bear the brunt of the financial burden.  It is essential that the Senate moves forward with a debate on the cause of the universal anxiety in America, and that we finally address this energy crisis.  We must come together to forge a bipartisan pathway towards real results.  Anything less is a disservice to the American people and I’m disappointed that the Senate failed to move forward with this challenge.

Had the energy bill advanced, it would have repealed $17 billion in tax breaks granted in 2004 to companies such as Exxon Mobil Corp., (XOM) Chevron Corp. and BP PLC (BP).  Oil companies would be subject to a 25% tax on windfall profits related to the surge in crude oil prices.  The legislation would also have given the U.S. Attorney General the power to take action against OPEC for limiting oil production and authorized the Federal Trade Commission to take action against big suppliers determined to charge excessive prices and increase the penalties for price gouging.

Also included is in the legislation was standalone legislation I co-sponsored – a Federal Price Gouging Statute.  Specifically, the legislation would establish a federal law against selling gasoline at “unconscionably excessive price” in a region declared an “energy emergency” by the President.  In addition, the legislation includes the “No Oil Producing and Exporting Cartels Act of 2008,” or NOPEC, which amends the Sherman Act to allow the US government to sue OPEC in Federal Court.

While the effort to take a step forward to address the energy issue has stalled, there are still things we can do right now to address to remove unnecessary oil and gas subsidies, bring more transparency into our energy markets and invest in new energy sources.  Just yesterday, I was joined by Sens. Dianne Feinstein (D-Calif.), Ted Stevens (R-Alaska), Maria Cantwell (D-Wash.) and Ron Wyden (D-Ore.) in calling on the Commodity Futures Trading Commission (CFTC) to exercise emergency authority to require disclosure from institutional investors that use swaps dealers.

Recent testimony before numerous Congressional Committees indicates that between 2000 and 2002, major institutional investors began to view commodity futures markets as a new “asset class” suitable to be used in large financial portfolios.  Never before have so many institutional investors made large scale investments in commodity markets, but from 2003 to 2008, investments in commodity index funds rose from $13 billion to $260 billion.

At a time when American people cannot escape the direct impact that rising gas and oil prices have on their day-to-day lives, it is incumbent that we ensure that our energy futures markets are transparent and demonstrate supply and demand – not manipulation by large institutional investors.  Although the historic price increases and their toll on the American people is similar to the energy crisis of previous generations, speculation is massively different and we must ensure that these markets are properly working and not subject to manipulation.

This entry was posted on Tuesday, June 10th, 2008 at 2:27 pm and is filed under Politics .