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Congress Takes Action to Lower Gas Prices

May 26, 2008

Congress Takes Action to Lower Gas Prices

WASHINGTON – U.S. Rep. John Spratt (D-SC) today outlined the series of steps Congress has taken to help bring down the cost of gasoline and deliver relief to drivers across South Carolina.  In recent days, Spratt backed a new law to suspend filling the Strategic Petroleum Reserve, another law to support energy initiatives ranging from hybrid cars to fuel cells, and new laws to hold foreign oil cartels liable for market manipulation.

“Drivers in South Carolina are paying well over $3.50 a gallon for gasoline and suffering at the pump,” said Spratt. “Congress is looking for short term solutions to bring prices down and long term strategies to make us energy independent.”

Congress took action to bring down the price of petroleum by diverting 70,000 barrels of crude oil a day away the Strategic Petroleum Reserve (SPR) and into the open market.  Suspensions have lowered gas prices in the past, and while the president had the power to stop filling the SPR immediately, he declined to do so until Congress passed a law requiring it by a veto-proof margin.

A bipartisan majority in the House also passed the Gas Price Relief for Consumers Act of 2008.  The legislation gives U.S. authorities the ability to prosecute anticompetitive conduct committed by international cartels like OPEC that restrict supply and drive up prices.  The bill creates a Department of Justice Petroleum Industry Antitrust Task Force to investigate instances of alleged price gouging and market manipulation, and directs the GAO to investigate the effects on competition of mergers in the petroleum industry.

House Democrats took another step towards encouraging production and use of renewable fuels by passing the Renewable Energy and Job Creation Act, which provides tax credits for the production of renewable energy sources like solar and wind energy, tax incentives for the production of renewable fuels and energy efficient products, and substantial tax credits for hybrid automobiles.

Finally, Congress has enacted the Farm Bill, which boosts homegrown biofuels made from biomass and crop byproducts other than grain — using new technologies.  Without biofuels, gas prices could be 15% higher than they are now.  It also increases oversight authority to detect and prevent manipulation of energy prices.

“Taken together, these initiatives are significant, but they are the beginning steps in what must become a massive national commitment to conservation, alternative fuels, and independence from foreign crude oil.  In the short run, we need to do more to relieve people from skyrocketing prices. In the long run, we need action on the order of the Manhattan Project. Given the gravity of this problem, we need solutions across the spectrum,” Spratt said.

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