Today’s witnesses represent the major, vertically integrated oil companies that, collectively, made more than $36 billion in profits in just the first quarter of this year-- $36 billion in the first three months of the year.
Leahy attacked Bush and blamed him and the Iraq war for the increases but I'm not sure that the political grandstanding will help us solve the problem much.
Leahy added:
I want to hear directly from these oil companies about causes of the rising price of oil on which Congress can act. This Committee unanimously approved Senator Kohl’s NOPEC legislation, which would put an end to artificial limits on supply by ensuring that the U.S. Government has the authority to prosecute OPEC members for collusive behavior. Seventy members of the Senate have voted for this legislation, as have 345 Members of the House. Yet this President threatened to veto it.
Leahy then asked the oil executives how they would like antitrust laws applied to them. I think a better tactic might be to just inform them that he or someone else is moving on enforcement. He preferred the slap on the wrist approach.
Leah does not seem to grasp international reality. OPEC meets regularly to dish it out on consumers and he thinks this is wrong. It does not matter. If you have someone over a barrel, literally, you don't get anywhere by whining about it. The more direct question should be why Leahy and the Senate are not acting on the problem.
Leahy identities a key problem. He states:
Do they agree that we need to crack down on speculation and manipulation in the oil commodities market? Numerous experts have testified before this Committee and others that oil prices are moving higher as a result of speculators. Investors are betting up the price of oil, and consumers are paying the bill. Increasingly, this speculation takes place in over-the-counter trading, which avoids the oversight of the Commodity Futures Trading Commission, thanks to the Enron loophole.
Why is he asking their opinion? Does he seriously think they will agree and voluntarily be nice boys?
Maybe he is actually acting, since the loophole kept the CFTC blind to speculation and manipulation in the oil futures market. Last week, Congress passed the Farm Bill that would close this loophole. The President threatened to veto the legislation.
Finally, he added:
last week we were able to pass legislation calling for the Government to stop artificially inflating demand by diverting fuel to the strategic petroleum reserve. The President opposed it. Filing the SPR may have made sense when oil was $25 a barrel. At $125 a barrel, it is simply hurting consumers.
Leahy makes a tepid, fawning appeal to the oil boys to play nice as if he expects them to do so. He makes his grandstanding rhetoric against Bush seem like he has some backbone. Its a pathetic waste of time but then again, that's the Senate.
Cf. Statement of Patrick Leahy
Chairman, Senate Judiciary Committee
Hearing on “Exploring the Skyrocketing Price of Oil”
May 21, 2008
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