David Greene, a corporate fellow at the Center of Transportation Analysis, says that gasoline prices at $4/gallon provides a strong economic incentive to increase fuel economy for both car makers and car buyers. Greene explains that the U.S. needs to extend and simplify incentives for hybrid vehicles in order to raise new vehicle fuel economy and encourage the transition to more efficient electric drive systems. He also says that fiscal incentives for more energy efficient vehicles may be the most efficient policy for encouraging consumers to choose higher fuel economy and for encouraging manufacturers to invent and adopt advanced fuel economy technologies. (0:52)

 

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Steve Winkelman, the director of transportation and adaptation programs at the Center for Clean Air Policy (CCAP), recalls a joke his grandmother used to tell him about a man who wants to win the lottery but never actually goes out and buys a ticket. Winkelman says that America needs to “buy that ticket” if the country wants to insulate itself from oil price shocks and protect its communities from the impacts of global warming. He also says that Americans have to remember to “ask the climate question” to figure out their vulnerability to the impacts of climate change. (0:37)

 

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Senators Byron Dorgan (D-N.D.) and Amy Klobuchar (D-Minn.) held a press conference to discuss the Stop Excessive Energy Speculation Act. Dorgan said the act’s future lies in Republican support, saying that ending speculation is the first step in lowering oil prices and emphasizing that the need to halt excess speculation in the oil futures market is separate from calls for increased domestic drilling.

Dorgan said speculative oil prices have increased from 37 percent in 2000 to 71 percent in 2008. He called the market “infested with excess speculation,” saying though United States must develop alternative energies, a short term solution rests in controlling oil futures. Without high speculative costs, Dorgan said prices at the pump could be reduced by 20 to 40 percent.

Klobuchar, in response to suggestions that oil prices are reflective of the law of supply and demand, said American demand for oil has not increased by 25 percent, an increase she said would warrant higher prices at the pump. She cited oil executives statements that oil should be $50 per barrel and said the Stop Excessive Energy Speculation Act would put 100 “cops on the beat” who would oversee the activity of traders in the oil market. “Follow the money and you’ll find the bad guys” was the advice given by Klobuchar in reference to traders on Wall Street who, she said, are running away with Americans’ money.

Sen. Byron Dorgan (D-N.D.) says speculation is the cause of high oil prices, stating that solving excess oil speculation is the first hurdle in the United States’ quest for energy independence and that the market is currently “infested with excess speculation.” (0:54)

 

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Sen. Amy Klobuchar (D-Minn.) says there is no way to explain why gas has increased 25 percent in six months, noting that American demand has decreased and that a number of oil executives have said oil prices should be much lower given physical demand in the market. She quoted an expert who called the oil market “a gaming hall” and a “casino without rules.” (1:01)

 

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Sen. Byron Dorgan (D-N.D.) says some claim that there is a competition between ending oil speculation and drilling, reassuring that the Stop Excess Energy Speculation Act is the first step in helping to address America’s energy problem. (1:03)

 

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Mark Cooper of the Consumer Federation of America says that the United States is a crucial market for the oil industry and that Congress has the ability and right to regulate trade in the United States, saying those that disagree are asserting that the United States does not have national sovereignty. (0:47)

 

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Speaker of the House Nancy Pelosi (D-Calif.) called global warming and energy policy “the issue of our time” at a press conference where she urged President Bush to relieve high gas prices by opening the Strategic Petroleum Reserve. Pelosi said the SPR is 97 percent full, the highest it has ever been, and that Americans deserve access to gasoline purchased with their tax dollars. Pelosi, who made a similar request to Bush ten days ago, added that gas prices would have lowered by now if Bush had acted when she originally asked. Pelosi repeatedly stated that despite having two oil men in the White House, gas prices remain over $4.

Continuing, Pelosi said Bush’s energy policy have caused price spikes and discussed the democratic DRILL (Drill Responsibly In Least Lands) Act, an act that advocates increased developments in energy alternatives and minimal drilling. She noted that calls for off-shore drilling by Republicans will take ten years to enact and only lower prices by $0.02. Pelosi said this route would cause the average family to spend $57,000 on gas in the next decade. She called Bush’s solution to high energy prices a “hoax” and said a majority of Americans agree that increasing the development of alternative energies is a good way to decrease prices while building new jobs.

In reference to increased violence in Afghanistan, Pelosi criticized the White House for initially turning its attention towards Iraq, allowing the situation in Afghanistan to worsen. She said Democrats in Congress demand accountability from the military and the Executive Branch, adding that Bush is now realizing the commitment that is necessary to fight extremism in Afghanistan.

At a hearing on saving for retirement, Senator Gordon Smith (R-Ore.) says that these are tough times for American families. Smith says that with gas and food prices at a record high, it is difficult for families to pay for essentials. Smith attributes this to the reasons behind Americans making more hardship withdrawals from their 401(k) retirement funds.

 

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Visible frustration concerning increased oil prices was displayed by Senators at a meeting of the Senate Committee on Small Business and Entrepreneurship. To prepare for the winter, the committee met to discuss the effect of increasing oil prices on the cost of home heating oil.

Senator Olympia Snowe (R-Maine) presented statistics showing the rising cost of home heating oil in Maine. According to Snowe, the price of home heating oil has increased 135 percent in her state while income has only increased 17 percent. Snowe projects that Mainers will have to spend $5,000 to heat their homes with a per capita income of $33,000. Snowe said that many “could freeze to death,” adding that many throughout the United States will be unable to afford to heat their homes during the winter months.

Senator John Kerry (D-Mass.) said one can attribute the rising price of home heating oil to the rising cost of crude oil. In reference to the White House, Kerry stated that a stronger administration would be doing more to assist Americans. He also said he finds it shocking that Americans continue to waste energy by using electricity when it is not needed after 30 years of gas shocks and efforts to counteract global warming.

Deputy Assistant Energy Secretary for Petroleum Reserves David Johnson said in his testimony that the price of home heating oil can be lowered by increasing domestic production of oil by drilling on continental shelves and in the Arctic National Wildlife Reserve (ANWR.) Kerry told Johnson that oil from the ANWR would only lower American gas prices two cents per gallon at full production and that the United States only has three percent of global oil reserves. Kerry continued, saying the United States’ oil supply is not large enough to lower international prices and that the rhetoric employed by Johnson and others has “worn short.”