11.08.05

New York Top Cop Endorses U.S. Senator Maria Cantwell’s Anti-Gas Price Gouging Legislation

Top Oil Company Execs to Testify On Record Prices and Record Profits

WASHINGTON, D.C. – On the eve of when top oil company executives are set to testify at a rare joint hearing before the U.S. Senate Commerce and Energy Committees, New York State Attorney General Eliot Spitzer announced his support for U.S. Senator Maria Cantwell’s (D-WA) anti-price gouging legislation to protect consumers who are being hit hard at gas pumps. Wednesday oil company executives will testify in a rare joint hearing before the Senate Commerce and Energy and Natural Resources Committees. Cantwell’s bill is modeled on New York state law and has 28 cosponsors in the Senate.

"Oil companies need to tell us the truth," Cantwell, a member of both the Commerce and Energy Committees and head of the Democrats’ Energy Independence by 2020 campaign, stated. "They need tell the American people how 75 percent profit increases in 90 days is justifiable to consumers at the pump and at home. We need anti- price gouging legislation that allows the Justice Department, our State Attorneys General and the FTC to stop price gouging during energy emergencies."

New York Attorney General Eliot Spitzer endorsed Sen. Maria Cantwell’s Energy Emergency Consumer Protection Act of 2005 (S. 1735) on a conference call today, and in a letter to Sen. Ted Stevens (R-AK), chair of the Senate Commerce Committee (letter attached). Spitzer and Cantwell urged Congress to pass her legislation before adjourning for winter recess.

Spitzer wrote to Chairman Stevens explaining that Cantwell’s bill "would provide law enforcement with vitally needed tools to prevent price gouging, as well as allow greater federal scrutiny of possible market manipulation practices."

Right now 28 states have anti-price gouging laws, but there are no comparable federal laws. Spitzer noted, "If a large oil conglomerate abuses its market position during a real or perceived crisis, the effect is likely to be felt in may (or even all) states... Currently the FTC can act against such companies if they unlawfully agree to fix prices, but cannot act if unfair pricing practices occur simultaneously, but without collusion."

Although today’s gas prices represent a significant reduction from a post-Katrina peak of over $3 a gallon, crude oil prices are still over $60 a barrel. In just the last quarter, the oil companies earned almost $33 billion in profits in just 90 days. At the same time, gas prices in Washington state reached nearly $3.00 a gallon, and nearly three times the price they were three years ago.

Oil companies are expected to make over $100 billion in 2005. Exxon/Mobil alone made almost $10 billion last quarter--75 percent more than last year.

Likewise, Shell made $9 billon, an increase of almost 70 percent over 2004 third quarter profits. ConocoPhillips, meanwhile, enjoyed a staggering 89 percent profit increase, and BP reported $6.5 billion in profits.