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Office of the Speaker
H-232, US Capitol
Washington, DC 20515
(202) 225-0100
Contact:
Brendan Daly/Nadeam Elshami
202-226-7616For Immediate Release
05/01/2008
Pelosi Statement on FTC Agreeing to Democratic Demand to Investigate Manipulation of Oil and Gas Prices
Washington, D.C. – Speaker Nancy Pelosi issued the following statement this evening on the decision by the Federal Trade Commission (FTC) to move forward, in a response to a request by House Democratic leaders , on rules governing the manipulation of petroleum prices. The Energy Independence and Security Act (EISA), which became law last December, directs the FTC to ensure that the U.S. petroleum market is free from price or supply manipulation. In the wake of historic increases in oil and gas prices, House Democratic leaders and committee chairmen last week wrote to members of the FTC urging the swift implementation of the EISA market manipulation regulations.
“In our historic energy legislation of last year, Congress gave the FTC the authority to probe possible market manipulation of oil and gas prices and levy penalties against those who are cheating consumers, giving the commission new authority to protect consumers from skyrocketing energy costs. Last week, my colleagues and I wrote to the FTC demanding they move immediately to fully implement this critical ability to investigate gas prices.
“Today, as gas prices increased a record 18th day in a row, the FTC will take the long overdue action of moving forward on efforts to examine the manipulation of energy prices. I thank the FTC for heeding our call to protect consumers by using this new authority to probe oil and gasoline prices and punish those who manipulate the price at the pump.”
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Letter from FTC to Speaker Pelosi:
May 2, 2008
The Honorable Nancy Pelosi
U.S. House of Representatives
United States Congress
Washington, DC 20515
Dear Speaker Pelosi:
Thank you for the letter of April 25, 2008, from you and your House colleagues about the Federal Trade Commission's new authority, under Section 811 of the Energy Independence and Security Act of2007, regarding manipulation in wholesale crude oil, gasoline, or petroleum distillate markets. Today, the Commission will make public an Advance Notice of Proposed Rulemaking (ANPR), and our goal is to complete the Rulemaking process this year. We look forward to working with you and your colleagues as this Rule making moves forward.
Our staff has worked hard to move as speedily as possible. To date, an FTC task force has examined the development and use of anti-manipulation authority by other federal agencies, as well as by the states; met with other government officials (including the Commodity Futures Trading Commission, the Federal Energy Regulatory Commission, and the Securities and Exchange Commission); and, undertaken other tasks, both substantive and administrative, in connection with this legislation. The ANPR announces a comment period of 30 days, following which the agency expects expeditiously to analyze the comments received, draft a proposed rule, and issue a Notice of Proposed Rulemaking (NPR), with a 30-day comment period. We appreciate your efforts to combat high and volatile gasoline prices, and we will keep you apprised of significant developments throughout the Rulemaking process.
The learning that will accompany the ANPRINPR process is crucial. The Commission has not previously sought to develop a legal definition of the term "manipulation" or prosecuted a case alleging manipulation. Moreover, there are challenges involved in appropriately applying this broad concept to markets that, unlike electricity or natural gas, are not subject to comprehensive regulatory, disclosure, or reporting regimes. The pursuit of a case alleging manipulation in wholesale markets for crude oil, gasoline, or distillates may encounter other complexities arising from the differences between such products and the other markets in which manipulation cases have been brought, but we hope to overcome those challenges as we avail ourselves of the methods and opportunities contemplated by the ANPR/NPR procedures. Specifically, we believe that there is no better way to generate meaningful comments that will assist in our development of a workable rule for the benefit of the American public.
Enclosed please find a copy of the ANPR which we expect to be published in the Federal Register on Monday, May 5, 2008. The Commission greatly appreciates your interest in this topic. Please feel free to contact Chairman Kovacic at any time with any additional questions or comments, or have your staff call Jeanne Bumpus, the Director of our Office of Congressional Relations, at (202) 326-2195.
Sincerely,
William E. Kovacic
Chairman
Pamela Jones Harbour
Commissioner
Jon Leibowitz
Commissioner
J. Thomas Rosch
Commissioner
Congressman Tom Allen
April 1, 2008
Ms. Belinda Raymond
Dear Ms. Raymond:
Thank you for expressing your concern about rising gas
prices. It is good to hear from you again. Thank you for all of
your hard work at the Coalition to Lower Fuel Prices in Maine.
Like you, I am extremely concerned about the immense
fuel burden being put on our already delicate industries in Maine.
Independent truck drivers, forest workers, and fisherman are being
hit hardest because their profits rely so heavily on the cost of fuel.
Everywhere I go in Maine, people tell me that they are struggling
with the high cost of diesel, gasoline and heating oil. In November
2006, oil traded at around $58 per barrel; today, it is at $100 or
more per barrel. Motorists paid $2.30 a gallon for regular gas;
today they are lucky to fill their tanks at $3.25 a gallon. At $4.00
or more a gallon, the price of diesel fuel is threatening to put
Maine's independent truckers out of business. Often saddled with
fixed-price delivery contracts, truckers cannot pass these
skyrocketing costs on to their customers. Last winter was
relatively mild in Maine, and households could purchase fuel oil
for around $2.20 a gallon. This winter, we have not had short
sleeve temperatures, and heating oil prices are at a staggering
$3.70 a gallon.
I believe that the solution to high gas and heating oil prices
should include prompt, effective federal action on several fronts.
Since the fall of 2005, when fuel prices exploded after the Gulf
Coast hurricanes, I have made this issue a priority. In the House,
we are making progress, but before effective remedies become
law, the voices of Mainers whose jobs or health are threatened by
runaway fuel costs must be heard not only in the House, but also
by the Senate and White House.
The House has already approved the Federal Price Gouging
Prevention Act (H.R. 1252), which I cosponsored. This legislation
would provide the Federal Trade Commission with explicit
authority to define price gouging and to investigate and punish
those who artificially inflate the price of oil, natural gas, home-
heating oil, crude oil, and propane. Current law is weak, both in its
failure to define price gouging or to give the FTC the tools to
prosecute profiteers at the top of the chain, like Exxon-Mobil.
Stiff new civil penalties would make violators regret ever gouging
a single Maine family.
H.R. 1252 passed the House in May, but the bill has been
bogged down in the Senate by the allies of Big Oil. This must end;
a federal price gouging law is needed now to keep America and
Maine working and warm.
The same scenario is unfolding concerning a rollback of the
huge tax breaks Congress doled out to Big Oil in the 2005 Energy
Bill. These giveaways were a disgrace back then, when I voted
against them. With the obscene profits energy companies report
today, it is outrageous that American taxpayers are not only paying
through the nose for fuel, but as taxpayers, subsidizing the
industry. In January, the House repealed these unwarranted tax
breaks. In the Senate, however, the friends of Big Oil have
filibustered, refusing to allow the House-passed bill to come up.
I am also pushing for two other proposals pending in the
House to rein in fuel prices. The first would regulate speculators
who are now are driving up energy prices through off-market
trading. The Commodity Futures Trading Commission (CFTC)
oversees only about 25 to 35 percent of all energy commodities
trading; the rest of energy speculation occurs without any public
oversight. H.R. 4066, the Close the Enron Loophole Act, would
require these market manipulators to abide by the same rules that
already govern on-market traders. Transparency and increased
oversight by the CFTC will instill confidence in the market, help
eliminate unnecessary crude oil price inflation, and give American
families a break at the pump.
Finally, I am fighting for my Small Business Fuel Cost
Relief Act, H.R. 2133. This bill would create a tax credit for
eligible businesses for any amount they spend on fuel (including
gasoline, diesel, natural gas, and heating oil) over the price on
Labor Day 2004, adjusted for inflation. In New England, diesel
now is about $4.13 at the pump. Last year, the price was $2.78;
back on Labor Day 2004, it averaged $1.94. My bill also would
raise the IRS Standard Mileage Rate to 60 cents for business
owners who use their vehicles for business purposes. These
changes would provide our small businesses the reprieve they need
to survive.
Spikes in fuel prices inflate the cost of almost every
product and service purchased by families and businesses.
Congress must act soon to provide consumers relief from sky-high
fuel prices. Please be assured that I will continue to work for > common sense energy policies that achieve these goals.
Again, thank you for contacting me. Please feel free to do
so again on issues important to you.
Sincerely,
Tom Allen
Member of Congress
MAINE'S SPEAKER OF THE HOUSE : Rep. Glenn Cummings Recieved 4/01/08
JOINT RESOLUTION MEMORIALIZING THE UNITED STATES CONGRESS
TO STOP GASOLINE PRICE MANIPULATION AND TO CLOSE THE ENRON
LOOPHOLE
PRESENTED BY:
(Speaker CUMMINGS)
TOWN: Portland
123LR3502(OI)-1
Approved for introduction by a majority of the Legislative Council pursuant to Joint Rule
214.
STATE OF MAINE
IN THE YEAR OF OUR LORD
TWO THOUSAND AND EIGHT
JOINT RESOLUTION MEMORIALIZING THE
UNITED STATES CONGRESS TO STOP GASOLINE
PRICE MANIPULATION AND TO CLOSE THE
ENRON LOOPHOLE
WE, your Memorialists, the Members of the One Hundred and Twenty-third Legislature of
the State of Maine now assembled in the Second Regular Session, most respectfully present and
petition the United States Congress as follows:
WHEREAS, energy prices are reaching an all-time high in the United States and its citizens
are especially hard-hit in the State of Maine, as our cold winters are long and many of our citizens
use petroleum products to heat their homes; and
WHEREAS, diesel fuel prices for Maine truckers are causing severe economic hardship for
this hardworking industry and gasoline fuel prices continue to rise, causing financial hardship to
all Maine citizens; and
WHEREAS, it is apparent to the United States Congress and the citizens of Maine that some
of the serious factors causing the high prices are excessive trading, speculation and, allegedly,
manipulation of the commodities market; and
WHEREAS, the United States Congress passed, in December 2000, at the behest of the
American energy company Enron, what is known as "the Enron Loophole" as part of the
Commodity Futures Modernization Act of2000, Appendix E ofP.L.106-554, 114 Stat. 2763, and
this loophole allows electronic exchanges set up for large traders to operate without any federal
oversight; and
WHEREAS, one of the fundamental purposes of futures contracts is to provide price
discovery, and those selling or buying commodities in the spot market rely on futures prices to
judge amounts to charge or pay for a commodity; and
WHEREAS, since the creation of the futures markets in the agricultural context decades ago,
it has been widely understood that, unless properly regulated, the markets may distort the
economic fundamental of price discovery through excessive speculation, fraud or manipulation,
and the federal Commodity Exchange Act has long been praised as preventing those economic
abuses; and
WHEREAS, a recent bipartisan United States Senate report, "The Role of Market
Speculation in Rising Oil and Gas Prices: The Need to Put the Cop Back on the Beat," stated that
as much as 25% of the cost of a barrel of crude oil may be due to the cost of speculation and
profiteering taking place in these unregulated commodities markets; and
Page 1- 123LR3502(Ol)-1
WHEREAS, this speculation and profiteering unfairly causes many Maine citizens to pay
excessive fuel and gas prices; now, therefore, be it
RESOLVED: That We, your Memorialists, on behalf of the people we represent,
respectfully and strongly urge and request that the United States Congress rein in this excessive
energy commodities speculation and enact meaningful reforms of the Commodities Futures
Trading Commission, including closing "the Enron Loophole"; and be it further
RESOLVED: That suitable copies of this resolution, duly authenticated by the Secretary of
State, be transmitted to President of the United States Senate and to the Speaker of the United
States House of Representatives, and to each Member of the Maine Congressional Delegation.
Page 2- 123LR3502(Ol)-1
Regional Representative Deborah McNeil for Sen. Olympia J. Snowe 4/1/08
Hi Belinda,
I wanted to make you aware of the Kennebec Somerset Transition Team that has formed to help prepare workers during layoff situations that ensue as a result of facility closings. It is a network of service providers prepared for a timely and unified response to the hardships faced by both the dislocated workers and the community. In times of desperation, it is critical to have a coordinated response to these reductions in employment and the participants are the Maine federal delegation offices, Maine state legislators, state and community agencies, churches, local business leaders and countless other independent organizations to create comprehensive resource guides for distribution to dislocated workers and their families, allowing them to easily seek the assistance they may need. The meetings are run by the CAP agencies and displaced workers receive help from the Career Centers.
Most every county has a team that is helping with the issues of layoffs and although they were set up for larger plant and factory closings such as SAS in Pittsfied we are finding that there is a growing number of smaller businesses and self employed workers. I think the contact information can be helpful as smaller self employed folks and those with only one or two workers find themselves in a situation where they cannot keep the business going. It would at least be a source of information to share in case folks do not know where to turn.
At the meeting yesterday it was brought up about the truckers diesel dilemma and how could they reach out to those folks. I offered to contact you and see if you would like to have some information to share in case anyone you know needs it or that you can share via the email addresses you have set up. Please let me know if you would like this information. I can also get you the contacts for the teams that are already formed in other counties.
With regards,
Deb
Deborah E. McNeil
Regional Representative to
U. S. Senator Olympia J. Snowe
***I have responded accepting any and all information to share. As soon as I have it you WILL have it also, Belinda. |
