President urged to use oil reserve

[Eugene]

(Boston Globe, free reg. required.)

President urged to use oil reserve

N.E. senators cite rising costs of home heating

By Alan Wirzbicki, Globe Correspondent | November 6, 2005

WASHINGTON -- With winter approaching and home heating costs
expected to rise by more than 30 percent across the Northeast,
a group of New England senators has asked President Bush to
release the federal government's emergency reserve of heating oil
for the first time.

Since 2000, the government has stockpiled 2 million barrels of
heating oil -- enough to heat the entire region for two days -- at
facilities in Providence, New Haven, and Woodbridge, N.J.

Senator Olympia J. Snowe, Republican of Maine, and senators
Christopher J. Dodd and Joseph I. Lieberman, both Democrats of
Connecticut, asked Bush last week to tap the reserve, citing the
unprecedented strain on oil-and-gas supplies in the region created
by hurricanes in the Gulf of Mexico.

Rising prices along with lower-than-usual inventories of heating oil
in the Northeast are ''a recipe for disaster," the senators wrote in
the request. In recent weeks New England lawmakers have expressed
frustration with Washington's response to the region's looming energy
crunch.

<snip>

More: http://www.boston.com/news/nation/washington/articles/2005/11/06/president_urged_to_use_oil_reserve/

[brokensymmetry]

1. Oh, joy.

Let's use up the reserves. That way, when the Peak Oil crunch hits, we won't have any...

:banghead:

[RC]

2. Good idea. I like the way you think...

But some are working on a better solution.

http://money.cnn.com/2005/10/28/news/economy/windfall_tax/

Oil industry under fire
Soaring earnings prompt calls for a windfall profit tax, but will big oil end up having to pay?
October 28, 2005: 2:51 PM EDT
By Chris Isidore, CNN/Money senior writer

NEW YORK (CNN/Money) - Soaring energy prices and record profits for big oil companies have sparked a wave of public outrage in the United States that's led all the way to Capitol Hill.

>SNIP<

Sen. Byron Dorgan has introduced a three-year tax of 50 percent for any profit oil companies make for oil sold above $40 a barrel.

But even the North Dakota Democrat admits it's an uphill battle for the bill.

"This is not a very hospitable political environment to challenge the oil industry," Dorgan told CNN/Money. "We have a president and vice president who come from the oil industry and they're not interested in doing anything that runs counter to the interests of major integrated oil companies."

But Dorgan said he's sensing some growing support for a tax across the aisle.

* * * * * *

Other views: In North Dakota we use twice as much gasoline per person as New Yorkers do. Why?
By Sen. Byron Dorgan,
Published Sunday, November 06, 2005

>snip<
There’s no free market for oil. OPEC oil ministers sit around a table, colluding about supply and price. The big integrated oil companies (bigger and stronger as a result of mega mergers) face less and less price competition. Finally, the futures market is a grand bazaar of speculators. There’s no free market there – only an unfair process that gives record profits to the major integrated oil companies and record pain to consumers.

We should enact a windfall profits tax to recapture those excessive profits and use the funds to make rebates to consumers hurting from these prices.

My proposal applies only to the major integrated oil companies and exempts from the tax the windfall profits invested back into searching for more energy or building refineries.

Rather than investing in more energy exploration, building more refineries, many big oil companies are currently buying back their stock, hoarding cash, or looking for more mergers and acquisitions on Wall Street – “drilling for oil” on Wall Street, as Business Week Magazine describes it. (I’ve got news for them – there’s no oil on Wall Street.)

The 50 percent windfall profits tax (on profits above $40 a barrel) I’m calling for will be the biggest incentive you can find for the big oil companies to invest in things that increase domestic energy supply, and thereby avoid paying the tax.

http://www.in-forum.com/articles/index.cfm?id=107686§ion=Opinion