Lawmakers Accuse Oil Companies of ‘Rip-Off’ : Energy: Bush is urged to persuade firms to lower gasoline prices. The President is also asked to dip into U.S. reserves in wake of Kuwait invasion.
WASHINGTON — Lawmakers today charged oil companies with greed and a “massive rip-off†and called for presidential jawboning and tapping of emergency oil reserves to combat rising gasoline prices that have followed the invasion of Kuwait.
“In the last week, American consumers have been ripped off on a massive scale,†Sen. Joseph I. Lieberman (D-Conn.) complained at a hearing before the Senate Commerce consumer subcommittee.
Iraqi President Saddam Hussein, whose troops took over oil-rich Kuwait on Thursday, “may not be the only greedy person in this picture,†said Rep. Philip R. Sharp (D-Ind.) as he opened a hearing of the House Energy subcommittee on energy and power.
The chief targets of the hearings were U.S. oil companies, which have raised gasoline prices by as much as 19 cents a gallon since the invasion. The Justice Department served notice Monday that it will seek out and prosecute any anti-competitive practices.
Charles J. Dibona, president of the American Petroleum Institute, said critics of the price increases are taking “a naive, one-sided view of how markets work.â€
In written testimony for the Senate subcommittee, Dibona said oil companies had no choice but to pass on to consumers immediately the higher cost of oil--even though gasoline from that oil will not reach pumps for months.
Lieberman and witnesses at his hearing said President Bush should summon executives of the big oil companies and tell them to stop gouging the public. Lieberman cited President John F. Kennedy’s example in dealing with a steel price increase.
“It’s called leadership,†said Rhode Island Atty. Gen. James E. O’Neil. He said there is little that state and local officials can do to bring down gasoline prices.
Sharp said the loss of oil from Iraq and Kuwait calls for dipping into the 509-million-barrel U.S. Strategic Petroleum Reserve. “The time to use it is now,†he said.
But John Easton of the Energy Department said the law allows use of those reserves only to make up for supply shortages, not to bring down prices.
GASOLINE PRICES
Regular unleaded, self-serve price per gallon
Monday Aug. 6 $1.186
Based on a telphone survey of 1,400 retail gasoline stations nationwide.
Source: American Automobile Association, Computer Petroleum Corp.AP/Los Ange;les Times
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