Volume 154, No. 68 covering the 2nd Session of the 110th Congress (2007 - 2008) was published by the Congressional Record.
The Congressional Record is a unique source of public documentation. It started in 1873, documenting nearly all the major and minor policies being discussed and debated.
“ENERGY” mentioning the Environmental Protection Agency was published in the Senate section on pages S3454-S3456 on April 28, 2008.
The publication is reproduced in full below:
ENERGY
Mr. SESSIONS. Mr. President, I thank the Chair and Senator Klobuchar for her comments. These things just take time. I fully understand that.
I would share with her a question as to why we would continue to pour large amounts of petroleum into our Reserve when we are clearly at high, even peak prices that seems to me not a good idea. It would help relieve some pressure on price and on supply if we were to suspend that. I also share her concern that on the world market, we are not in a free marketplace. Those experts who said they thought the price ought to be $50, $55 a barrel, I don't know what the prices ought to be, but I know OPEC meets and decides what the production level will be. As a prosecutor myself, that is a cartel. That is price fixing, as I understand it. Somehow, we need to make it a part of our sustained national policy to stand up to this.
In one sense, what OPEC does when they drive up the price by limiting production, what they are doing is taxing the United States of America. They just decide how much they are going to tax us for the oil we use. One expert has said that the cost of producing a barrel of oil in those fabulous oil sands in Saudi Arabia is less than $10 a barrel. So we see what the profit margin is when it hits $120 a barrel on the world market. Many factors are in it. I know the decline in the dollar and other factors are involved.
But I just want to say that I do think we are moving into a new era of government-controlled oil more than we ever have. Most people think oil companies control it. But recent studies show about 85 percent of oil is owned by nation states. For example, Mexico owns all of its oil and will not allow private industry to participate in its extraction. Because the Government is inefficient and unproductive, their production has fallen, whereas Mexico has huge reserves. Venezuela's production has fallen. Aramco, the Saudi Arabian company, owns theirs, and their production has fallen. As a result, we continue to see shortages on the world market, driving prices up, allowing certain people who are clever and smart and who have invested wisely or aggressively to make billions of dollars.
We have a serious energy problem in the United States. The high costs are impacting the lives of American citizens and farmers and others. There was an article in a local paper--I believe the Mobile Press Register--that I saw today where an individual who has a shrimp boat parked his boat at the dock and said: If the price of shrimp doesn't go up or the price of fuel drop, I cannot make a profit. There is no way I can go out and do this. He docked his boat. There was a similar article in the Florence Times talking about farmers and the increasing cost farmers see from the fuel they use.
Increased demand from India, Southeast Asia, South America, with decreased production around the globe, has created the opportunity for prices and profits to grow for certain people who are wisely positioned.
During my last trip to Alabama for a week, I had townhall meetings and visited with people throughout the State. Energy prices were the No. 1 thing people talked to me about. It is having a real impact on their family budget. The price of regular unleaded gasoline climbed to
$3.50 a gallon. A year ago, it was $2.84, and 2 years ago, it was
$2.74. That is a 28-percent increase in 2 years. This helps explain the economic doldrums and slowdown we are in. The typical American family with two cars is paying about $750 to $1,000 more per year for the same amount of fuel they were buying the previous year. That represents $70,
$80 a month of disposable income that previously they could use for other things for their family. It is now going to buy the same amount of fuel they were using the year before or 2 years before. This represents a huge economic hit to the American family.
There is another adverse, serious problem for America as a nation: More than 60 percent of the fuel we utilize in our vehicles comes from places such as Saudi Arabia and Venezuela and Russia and Mexico, some of which countries are not friendly to us. That represents a $400 billion transfer of wealth on an annual basis from this country. Businessman T. Boone Pickens, in a recent interview in the American Spectator, referred to this as ``the greatest transfer of wealth in the history of mankind.'' That is a pretty smart guy. He is an oil man himself. He said we have to do something about this. It is not something we can just ignore.
Of course, there is no silver bullet to solving the problems, but there are some basic principles we should respect. We must increase supplies in our own country, increase production in our country, which we certainly can do and which I regret to say we have attempted in this Senate and in the House more than once, to be blocked by various groups that seem to complain about high energy prices but don't want to do anything to allow us to produce more in the United States. We must conserve more energy. I supported the increased gas mileage standards which represent a substantial improvement. Maybe we can even do more. We certainly must try to use more biofuels, if we can, although under current technologies, we are reaching the limits. But I think other technology will help us in the future to expand the amount of biofuels we can use. We must use the fuel we have more efficiently.
The Government does have a responsibility to ensure that we have fairness in the world marketplace and in the American marketplace and to make sure these cartels openly fixing the price of oil do not succeed. As I will discuss in a minute, I think we should take a serious look at establishing a policy with regard to diesel fuel. I will mention that in a moment.
I know the problem for gasoline is hitting American families directly. But at this moment, I would like to share some specific thoughts about diesel fuel and those high costs.
Recent spikes in diesel fuel prices don't get a lot of attention in the media, but it has a huge impact on consumers and businessmen and truckers and shrimpers and farmers.
Today, I had the pleasure to meet with six independent truckers who are here in Washington to bring attention to the skyrocketing cost of diesel fuel. They had press conferences, and they talked to a number of people. I invited a group to come to my office.
Over-the-road trucks, 18-wheelers, heavy equipment, and agricultural trucks almost exclusively use diesel fuel. This month, diesel fuel prices climbed to $4.14 a gallon. Two years ago, it was $2.72. That is a 52-percent increase in diesel fuel, substantially greater than the increase in gasoline. That is putting a huge stress on trucking companies--independent truckers, particularly--small businesses, and farming and fishing operations.
Among automobiles and pickup trucks, 98 percent of the people drive vehicles that use unleaded gas. So you might say: I am not a trucker or a farmer. Those prices don't really affect me. But that is just not so, really. There are two ways the market for diesel fuel affects the average person's pocketbook. When diesel prices go up, the cost of transporting goods, consumer products, and food goes up. That increase is passed to consumers. Secondly, we have an opportunity, through improved diesel technology, of making diesel engines cleaner and more efficient than ever before. Mercedes, for example, Daimler-Chrysler, is offering consumers a range of vehicles with its blue tech diesel engine that is built in my home State. So we should spend a few minutes looking at our policies and how they affect diesel prices.
I hope the Energy Committee, of which I am a member, will have some hearings on this issue. It would be worth our having some time set aside exclusively to this problem. Nearly all trucks and delivery vehicles utilize diesel fuel. The price of diesel fuel affects our country in so many ways. Trucking currently uses 75 percent of the total diesel fuel used in the United States. Only 3.5 percent of the automobiles in America use diesel. But in Europe, approximately 50 percent of the automobiles are diesel. And in the United States, one action we took that may have had some impact on not using so much diesel fuel but had a good impact, perhaps, for the environment was to demand very clean, low-sulfur diesel fuel. Our diesel fuel is lower sulfur than the Europeans, and that is because of environmental reasons.
But did you know this? Diesel automobiles run approximately 30 percent farther on diesel fuel than similar gasoline-powered automobiles. Diesel engines get 30 percent better mileage than gasoline engines. Diesel-powered automobiles also get more miles per gallon even than hybrid automobiles, or about the same. Some insist it is better, but they are pretty much equal. In addition to being fuel efficient, diesel-powered automobiles emit fewer CO2 emissions than similar hybrid and gasoline engines. A lot of people don't know that. Of course, that is why 50 percent of the automobiles in Europe, which has analyzed this more carefully than we, it appears, are now diesel. The European Union has emphasized diesel engines because it takes 30 percent less fuel to run a diesel engine.
The average price of diesel fuel used in motor vehicles has historically been lower than the price of regular gasoline. According to the Department of Energy, the average price of diesel has been higher than gasoline since 2004--as a matter of fact, substantially higher.
So for some reason, even though diesel fuel traditionally has been less expensive and requires less refining effort than gasoline, it has been averaging 64 cents a gallon more than gasoline.
Now, like I said, I believe in a free market. I am loathe for the Government to intervene. But let me ask this question: Why is that? Why? Why would a product that should be cheaper be consistently, since 2004, more expensive than the other product? I, frankly, do not know. But it does appear our country has made a determination to shift to a gasoline economy and a hybrid economy.
I think it is fabulous we are utilizing large numbers now of hybrid vehicles--large numbers. We certainly have enough on the roads today to be able to find out how well they work, to make their capabilities more sophisticated, to improve their lifespan, to improve their efficiency, to work out the bugs.
A lot of people are finding that the savings in gas alone will help pay for the somewhat more expensive hybrid engine. So I am not against the hybrid engine, and I am delighted we are leading the world in the effort to utilize hybrid engines.
What I am asking is, how have we gotten ourselves in a situation in which the less expensive diesel fuel, that gets 30 percent better gas mileage, is not readily available and is costing 64 cents more a gallon? Something is awry as far as I can see.
I say, let's get busy. Let's do something about it. Let's stand up to OPEC. Let's use every political influence and pressure we have to encourage them to increase productivity to reduce these shortages. Let's stop, at least temporarily, depositing to the petroleum reserve. Let's expand biofuels, and particularly biodiesel, which is a fabulous fuel that, unlike ethanol, is just as productive as diesel fuel and actually is even cleaner than diesel fuel.
We need to figure out how to get more production domestically from our own reserves. I will not go into the arguments we have had about ANWR, all the oil shale in the West, and offshore drilling. We simply have not done enough of it, and we still have large reserves available to us in this country. So when those reserves are produced, that wealth does not go to foreign nations but is kept within the United States, creating jobs in our country.
So we need more production, and we need to look at this question of refineries. I do not know what the problem is, but we need to ask some questions. I have already asked the Congressional Research Service and the Department of Energy some questions. But I intend to look at this more as to why we do not have sufficient diesel fuel being produced in the country and we continue to have shortages of it.
So that is what I think we need to do. I am not unaware and I understand completely that the surging cost of energy impacts working Americans directly. It hits their pocketbook. Those are the people who have the least disposable income, and it is like a hidden tax.
Yes, oil is more valuable today than it was. Mr. T. Boone Pickens, in his article, said he thought we were at a peak oil situation in the world while demands are going up worldwide. I do not know that we are yet at a total peak. I doubt we are, frankly. But we are getting close to that. So the oil is just a more valuable product. I understand that. But we need to execute the policies we know will work to help contain the price increases that are hurting Americans.
I will add this one thought: We need to be careful about cap and trade and other pieces of legislation that focus solely on CO2 emissions because we know those actions and those pieces of legislation will only drive the cost of fuel higher. According to the Environmental Protection Agency, which has just completed a study of the cap and trade bill that the Environment and Public Works Committee just reported to the floor a month or two ago, that bill would raise the price of gasoline 50 cents a gallon. It could raise the price of electricity maybe as much as $100 a month for a family. Who is going to pay that?
So we have to be very careful when we pass cap-and-trade, global-
warming-type legislation, that when we do, we do not dump huge costs on working Americans, on low-income Americans which they do not deserve and they are not justified. So I think that is a matter we will need to consider in the weeks to come.
I thank the Chair. I appreciate the opportunity to share these remarks. I appreciate very much the truckers who were in my office today. I enjoyed talking with them. They told me stories of people who are having to park their trucks and not being able to continue to work. They told me stories of people who were going to go into bankruptcy; they could not continue to make their payments.
So it is not an academic matter. It is a very real thing. We need to take action consistent with our great heritage of freedom in our country to see what we can do to confront this rising cost of energy.
I thank the Chair and yield the floor.
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