Durbin, Colleagues Drive Effort to Lower Gas Prices for Consumers

DURBIN, COLLEAGUES DRIVE EFFORT TO LOWER GAS PRICES FOR CONSUMERS

Tuesday, April 19, 2005

[WASHINGTON, D.C.] - At a time when Illinois residents are paying more than $2 a gallon for gas, U.S. Senator Dick Durbin (D-IL) joined his colleagues in pushing an emergency measure that would increase the supply of domestic crude oil, helping to provide relief to consumers at the pump.

Durbin is an original cosponsor of an amendment authored by U.S. Senator Chuck Schumer (D-NY) that was introduced last Friday to the Supplemental Appropriations bill. The amendment mandates the release of 30 million barrels of oil from the Strategic Petroleum Reserve (SPR) over 30 days, with the option to release an additional 30 million barrels if conditions warrant such actions. The amendment also calls on the Bush Administration to become more aggressive in dealing with the Organization of the Petroleum Exporting Countries (OPEC).

"As Yogi Berra said 'It's déjà vu all over again.' It's the start of another summer driving season and families in Illinois are feeling the pinch at the gas pump once again," Durbin said. "President Bush is looking the other way while consumers in Illinois are paying the price for the Administration's inaction. Opening the Strategic Reserve now can bring about price relief to hard working families in Illinois and across the country."

Durbin pointed out that despite the fact that the SPR is currently over 98% full, the Bush Administration continues to adhere to its policy of taking oil off the market and placing it in the reserve. Specifically, an average of 85,000 barrels per day will be taken off the market between the months of April and August, the months when Americans traditionally drive the most.

Initiating a swap of oil from the SPR to increase the supply of oil is a proven way to reduce the price of gasoline and heating oil. In the fall of 2000, the Clinton Administration announced a swap of 30 million barrels over 30 days, causing crude oil prices to quickly fall by over $6 per barrel and wholesale gasoline prices to fall $0.14 per gallon. Under a swap, the federal government could decide on a set quantity of oil to release from the SPR, and accepts bids from private companies for the rights to that oil. The companies would then bid on how much oil they are willing to return, in addition to the oil they would receive under the swap, to the SPR at a later date.

The amendment is currently pending before the Senate.

http://durbin.senate.gov/record.cfm?id=236593&&