Rather than embrace greater North American energy production to combat skyrocketing gas prices, like clockwork, Democrats are dusting off their tired attacks on the specter of speculators. In a rose garden speech yesterday, President Obama blamed Wall Street speculators for high gas prices and asked Congress to strengthen oversight of oil markets and increase penalties for market manipulation. Speculation occurs within any market, and it occurs without harm. For example, if an airline purchases fuel in advance because it believes prices will rise, that’s a type of speculation. It’s not the same as market manipulation, which is already impermissible, and which federal authorities have the power to prevent. Notably, numerous studies have confirmed that speculation is not the primary cause for rising gasoline prices. Even the president himself admits that fundamental supply and demand are the driving forces behind gasoline prices, which is why instead of finding scapegoats, House Republicans are working toward solutions that will increase our access to stable and reliable energy supplies.
Today, the House will vote for a fourth time to force approval of the Keystone XL pipeline and bypass the president’s roadblocks to this project that would provide the U.S. with nearly one million barrels of additional oil per day. The president recently toured the country calling for solutions that increase our energy supplies and reduce our dependence on Middle East oil, but his actions don’t match his rhetoric. He personally lobbied the Senate to block congressional approval of the pipeline, and the administration’s latest Statement of Administration Policy indicates he will continue to stand in the way of this supply solution, even as gas prices hover near $4 a gallon.
If the president believes that speculators are the problem, the number one way to disarm them would be to increase supply. Keystone XL will more than double the current pipeline’s capacity and supply Americans with a reliable source of crude oil supplies for decades to come. This long-term guarantee of energy supplies will relieve pressure on crude prices, helping to calm the market and stabilize prices at the pump.
In Case You Missed Itâ€¦
Obama’s gas â€˜crackdown’ will do little to lower prices
The Washington Post, April 17, 2012
PRESIDENT OBAMA is fond of saying that there is no silver bullet to bringing down gasoline prices. On Tuesday, however, he went into the silver bullet business.
With gas prices high and an election looming, the president announced a very public “crackdown” on “those who manipulate the market for private gain at the expense of millions of working families.” He asked Congress to spend $52 million on more oversight, to allow regulators to set higher capital requirements in oil markets, and to mandate a few other steps. Many of the policies Mr. Obama proposed are fine â€” technology upgrades at the Commodity Futures Trading Commission (CFTC), for example. Yet the administration can’t offer any satisfying explanation for why they are so necessary as to require emergency congressional action. The only emergency seems to be a mindless election-year war over who’s to blame for sustained high gas prices â€” a question for which Mr. Obama himself has repeatedly given the most reasonable answer: those shadowy actors called supply and demand.
Obama Push on Oil Markets Seen as More Political Than Practical
National Journal, April 17, 2012
By Coral Davenport
Under continued attack from Republicans for high oil and gasoline prices, President Obama unveiled on Tuesday a slate of measures to crack down on financial speculation in energy-futures trading, which Democrats say helps drive up prices.
But while a Rose Garden announcement gave the president a platform to be seen calling for action on fuel prices, it’s not clear whether financial speculation is even a major contributor to oil and gasoline pricesâ€”or whether the administration’s proposals could have any real impact on the price at the pump.
House Republicans Revive Bid to Advance Keystone Pipeline
Bloomberg, April 16, 2012
By Jim Snyder
U.S. House Republicans, unsuccessful in overturning President Barack Obama’s rejection of the Keystone XL pipeline permit, will try again this week, using legislation to extend highway spending for three months. â€¦
Representative Fred Upton of Michigan, the House Energy and Commerce Committee chairman, said in the Republican’s April 14 weekly radio address that Keystone would “have decreased our dependence on oil from unstable regions of the world.”
White House threatens to veto bill that would force Keystone approval
National Post, April 17, 2012
By Roberta Rampton
WASHINGTON â€” The White House on Tuesday said Obama would veto legislation before the U.S. House of Representatives that sought to force approval of the stalled Keystone XL oil pipeline as part of a new 90-day extension of federal transportation funding.