Blumenthal Welcomes Bush Action on Gas Prices
By Anthony Cronin, The Day, New London, Conn.
Apr. 25–Attorney General Richard Blumenthal on Tuesday welcomed President Bush’s call for investigations into possible price gouging at the pump, adding that Bush needs to aggressively commit his federal resources in the continuing fight against price markups.
Blumenthal, during a press conference call, also reiterated his call for Bush to support a windfall profits tax and release more oil from the nation’s Strategic Petroleum Reserve. Blumenthal earlier this year presented a host of measures to Congress aimed at stemming the spiraling of gasoline prices, which now hover around $3 a gallon across eastern Connecticut.
“I welcome the feds to this fight,” Blumenthal said. “I am pleased that the president has realized that federal inaction and inertia is no longer an option,” he said.
Bush on Tuesday announced several measures, including temporarily halting shipments to the nation’s petroleum reserves and an easing of some clean-air regulations, that some have said led to gasoline shortages in the Northeast. Some oil refiners have said shortages could result as they switch over to more cleaner-burning summer fuel blends.
Rising gas prices also have caught the attention of U.S. Sen. Joseph Lieberman, D-Conn., who on Tuesday co-sponsored legislation that would crack down on possible price gouging and also investigate overconsolidation in the industry, now dominated by a handful of major multinational oil companies.
Lieberman said gasoline prices in Connecticut have spiked 34 percent, to about $3.01 a gallon, since last April.
On Tuesday, crude oil prices eased from their recent $75-a-barrel levels after Bush announced measures to help combat rising gasoline prices. Crude oil slated for June delivery closed the day around $72.88 a barrel on the New York Mercantile Exchange, but futures contracts that trade on that exchange are still hovering near $74 a barrel. A barrel of crude oil contains about 42 gallons.
Despite those high prices for crude oil, on an inflation-adjusted basis, crude oil per barrel would have to rise to about $97 a barrel to break the previous record highs. Even after adjusting for inflation, oil prices today are still roughly 20 percent below the record levels set during the early 1980s, when supply spigot tightened after the Iranian revolution and the war between Iran and Iraq.
Blumenthal said lax federal enforcement of antitrust laws has led to “dangerous monopolistic power” becoming concentrated in several large multinational oil companies. He said Bush should endorse a combined state-federal investigation to determine if such oil companies have abused their powers. He also endorsed a one-year moratorium on any oil-industry mergers and said refinery capacity needs to be expanded.
“Government tolerance of anti-competitive mergers and oil industry practices had enabled, even encouraged, the recent sharp rise in gasoline prices,” he said.
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