Mr. President, I rise today to talk candidly about rising gasoline prices and what we can do about them. I have been deeply concerned about our reliance on foreign oil and the rising cost of energy for many years. That was one of the…
Mr. President, I rise today to talk candidly about rising gasoline prices and what we can do about them. I have been deeply concerned about our reliance on foreign oil and the rising cost of energy for many years. That was one of the reasons I gave up my post as chairman of the Budget Committee in the Senate to become chairman of the Energy Committee. I saw energy dependence and rising energy prices as a big problem for this great Nation, and I wanted to help solve it.
Last year, we passed a bipartisan policy act called the Energy Policy Act of 2005. It was the first comprehensive Energy bill in 12 years. It took Republicans and Democrats 5 years and a lot of hard work to get this bill passed. It is an excellent bill and one I am proud of. This bill fixed a lot of our energy problems, and in a year or two from now, it will fix a lot more. Let me highlight a couple of the remarkable accomplishments which our Energy bill has put before the American people.
We create a pilot program in seven Western States that will streamline the permitting process so oil and oil developers won't have to wait years to develop their leases. Some people wonder: Are we doing anything to help America solve our problems? One thing we must do is develop our resources where we have them and where we can. We cannot sit by and be naysayers about developing what we have that we can use, so we don't have to buy it from others.
In this bill, we require 8 billion gallons of ethanol be included in the gasoline by 2012. This provision will help ethanol displace 2 billion barrels of foreign oil over the next 6 years.
There are those on the other side who say the President proposed nothing to help the farmers of the United States and the ranching community. I just discussed with you what the Energy bill will do with reference to ethanol, and all of that creates a new market for the products of our farmers, makes them wealthy, gives them alternatives to sell their product so they can be used to ultimately go into the tanks of our automobiles in lieu of crude-oil derivatives called gasoline. We provide several incentives in this bill for new nuclear power that have prompted nine utility consortia to plan at least 19 new nuclear powerplants in the immediate future. We had zero, we are already moving toward 19, and some think it is 22.
The bill encourages wind, solar, and geothermal sources. Our incentives will bring more than 14,000 megawatts of wind energy that could be on line by the end of next year, which is enough energy to power roughly 5 million homes for 1 year. Those are the things we did. Those are the things that would have all been front and center had Katrina not hit us and taken away all of the positives we were thinking of and put us in that tank that came as a result of that enormous hurricane which we are still recovering from. But all of the things I am discussing are there, actually taking place, as the United States changes because of that new energy bill.
The oil and gas prices continued to climb after the Energy bill was passed, and a lot of that was due to the hurricane I have described. We still have two refineries that are down because of the storm. That accounts for 5 percent of our refining capacity. We have lost about 1.5 million barrels of oil per day because of damaged oil rigs. That is a whopping 22 percent of our domestic production.
So for all of those who wonder: Did anything happen that could have caused the problems we are having that might have been otherwise? Obviously we can look at Katrina and say something very bad happened. We didn't have to have that. Things could have been better.
Let me talk about the global unrest and the rising global demand that has driven up the prices of oil across the globe. Oil is a global commodity. Nobody knows what a barrel of oil is worth as it comes out of the ground. Nobody knows what it is inherently worth. Let me say to my fellow Americans, I regret to tell you, it is worth what somebody will pay for it. That sounds strange, but that is what it is. It comes out of the ground, it is gathered up, and when it finally gets on a ship, somebody buys it. And what do they buy it for? They buy it for what they think it is worth, and they bid it, and that is what it is worth. So oil is worth what people pay for it. Regrettably, they are paying more and more because they are worried about the world situation and whether oil supply is credible, whether it is going to remain reliable. So they bid it up higher and higher.
Problems in producing nations such as Venezuela, Nigeria, and Iran have sharply driven up this price, along with this great, new, voracious appetite on the part of China and India. They are entitled-- they are entitled, just as we are--to use this oil, and they are buying it up, bidding it up, causing the supply and demand to have the impact I am describing with all of you here this morning.
There are some things we can do to try to ameliorate this problem, and, yes, some of them are very difficult. Most of it we can't do much about, unless we either wean ourselves off foreign oil, which will take several years to do, or dramatically increase our own production of oil. I regret to say there are too many on the other side of the aisle, not everyone but most on the other side of the aisle here in the Senate and in the House who refuse to acknowledge that we must produce more of our own wherever we can.
Let's talk about what we can do.
President Bush proposed four things yesterday, and I endorse every one of them. Every one of those is now out there for the market to look at, for everyone to look at, and they have already had a positive effect. He wants an aggressive investigation of fraud and manipulation. We mandated a similar investigation in the Energy bill, and I absolutely support what the President called for--an ongoing investigation into the manipulation or cheating that might be taking place. Let's get on with it. Let's put the resources in. Let's make sure the American people feel comfortable that it is taking place. We are doing it. Whether it proves anything, we will have to wait and see.
The President wants to do another thing. He wants to repeal certain tax breaks that are in the Energy bill. He says they are unnecessary for oil companies. I agree. Actually, I thought they would do some good, but the President has convinced me and many of us, under his leadership, to repeal those tax items that are in the bill. I am happy to take the lead, along with those who write the tax laws, and see if we can repeal and eliminate the deepwater drilling tax relief that is in the bill.
The President also recommended and announced that he will temporarily halt the filling of SPR, a move I hope will free up about 12 million barrels of oil this summer, meaning we won't use it for the Strategic Petroleum Reserve. So it will be available to those who are purchasing oil to be used as we have been describing it here: for the marketplace to put in refineries and be used by the great demand that is worldwide.
If we had developed ANWR--and I note the presence of the junior Senator from Alaska on the floor--if we had done that 10 years ago, if we had passed ANWR legislation--we did pass it. Had the President of the United States not vetoed it--and that was President Bill Clinton who vetoed it--then what we would have had available is at least 1 million barrels of oil--American owned--that we could use every day, and it would be added to the inventory that is out there for the world to use, and for the United States it would be a dramatic reduction in the amount of oil we would have to buy from others.
We have to wake up. There is nothing to be damaged. You can go look at ANWR and see what we would be doing with new drilling, new approaches to drilling, if we would get that done. It is regrettable that we won't produce our own and we will sit and talk and blame, and in particular, the other side will blame the President and blame Republicans. These Senators understand that today's gasoline prices are driven ever increasingly by long-term speculation on global production. They understand that a strong signal on supply can drive prices up today and down tomorrow. They know a vote to develop ANWR will have an immediate impact on oil prices, which in turn will have an immediate impact on gasoline prices.
Look at what happened to the energy markets yesterday after the President announced his four-prong plan. Energy prices fell. Yet these same Senators fought against ANWR, fought against OCS production, and have consistently fought against new energy production almost anywhere, production they know will ease our price and supply problems.
We have worked in the committee and marked up, gotten ready for a vote, Lease Sale 181 on natural gas, a bill that will develop oil and gas 100 miles off the coast of Florida. Democrats have threatened to filibuster the bill when it comes to the floor. It shows there is no desire to produce even what is our own.
The Massachusetts delegation continues to block the Weaver Cove liquefied natural gas facility, a facility proposed for Fall River that would provide 400,000 mcf of natural gas per day. That is enough to ease the price and supply pressure for most of New England.
Another example is if you don't want to produce energy that is our own, then you ought not be complaining about the fact that the price continues to rise because of shortages in global markets. Instead, today some on the other side propose a tax holiday. I find it interesting that it is Democrats who want to temporarily repeal the gasoline taxes since it was they who voted over the years to increase that same tax.
I can support the idea of a holiday. I like the idea of helping American families keep some of their money they are spending at the gas pump. But we use that money to build roads and mass transit. The Federal Government is going to have to make up those revenues somewhere. So let me propose this idea: Let's let the oil companies make up the difference. That is what we ought to do.
Anyway, I suggest we are on the right track. The President's suggestions are good suggestions, and we can come up with some more. But in the meantime, we ought to tell the American people the truth: There is no quick fix, and it is easier to blame than it is to have solutions. Let's look for the solutions and then we will all get a chance to judge who is doing the most to help America move toward energy independence.
I believe I have some additional time, and I yield it to the distinguished Senator from Alaska.