April 25, 2006

Bush, Big Oil, Slammed On Pump Prices

President Bush Proposes Oil System Changes, But Will Gas Costs Go Down?

  • Play CBS Video Video Dems To Bush: Aim At Big Oil

    CBS News RAW: Democrats reacted to the president's decision to halt reserve deposits and ease environmental rules on gas refiners by saying Mr. Bush should aim at big oil companies.

  • Video President Bush's Gas Plan

    CBS News RAW: In a speech at the Renewable Fuels Association Summit in Washington, President Bush spoke out against gas price gouging and called for energy companies to make sacrifices.

  • Video President Bush On Gas Prices

    CBS News senior White House correspondent Bill Plante reports on President Bush's reaction to rising gas prices, and calls from constituents to do something about them.

    • Sen. Charles Schumer, D-N.Y., left, accompanied by other members of Congress, gestures during a Capitol Hill news conference, Tuesday, April 25, 2006 to discuss rising gas prices.

      Sen. Charles Schumer, D-N.Y., left, accompanied by other members of Congress, gestures during a Capitol Hill news conference, Tuesday, April 25, 2006 to discuss rising gas prices.  (AP)

    • President Bush delivers a speech on energy to the Renewable Fuels Association in Washington, Tuesday, April 25, 2006.

      President Bush delivers a speech on energy to the Renewable Fuels Association in Washington, Tuesday, April 25, 2006.  (AP Photo/Gerald Herbert)

    • Gasoline prices over $3 a gallon are posted at a Brooklyn gas station Monday, April 24, 2006.

      Gasoline prices over $3 a gallon are posted at a Brooklyn gas station Monday, April 24, 2006.  (AP Photo/Mark Lennihan)

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  • Interactive Gas Prices

    State-by-state averages, tips to improve mileage and a look at what fuels prices at the pump.

  • Interactive Presidential Approval Ratings

    A sampling of President Bush's overall job approval ratings at selected points during his term in office.

  • Interactive Oil and Gas:
    Fossil Fuels

    Learn more about energy costs and usage in your state and get the latest prices for gasoline.

(CBS/AP)  As President Bush relaxed clean-fuel standards and ordered a temporary halt Tuesday to deposits to the nation's strategic petroleum reserve — ostensibly making more oil available for consumer needs and relieving pressure on pump prices — Democrats are blasting the administration's response to high gas prices.

Senator Chuck Schumer, D-N.Y., said big oil companies are the culprits behind runaway gas prices which he says go "way beyond what supply and demand would merit."

He said Mr. Bush refuses to "get tough on big oil."

Also Tuesday, crude oil and gasoline futures fell after Mr. Bush gave the Environmental Protection Agency the authority to relax regional clean-fuel standards to attract more imports of gasoline to the United States and to make it easier for supplies to be moved from one state to another.

But in an interview with CBS News, New York Attorney General Eliot Spitzer said acting only after prices skyrocket at the pumps shows a lack of preparation and insight by the administration.

With daily global demand roughly 85 million barrels per day, the world's oil producers have less than 2 million barrels per day of spare production capacity. So amidst a tight global market, both tensions with oil-rich nations and increased demand particularly in China, have severe effects on the commodities market — and at the pump.

"I would suggest that in the international markets, there is a disequilibrium," Spitzer told CBS News correspondent Russ Mitchell. "We have seen demand for oil increase dramatically year after year, especially due to the increase in demand in the Asian markets," which the administration could have foretold.

Spitzer's New York office has made 18 legal cases of gas gouging, particularly in the immediate wake of Hurricanes Katrina and Rita. While Spitzer called the gouging "wrong," he said that even consumers who comparison-shop can have little effect on the market.

"Realistically, as consumers, we cannot effect the global market or even the national market," Spitzer said. "We are the pawns. We are stuck."

Watch Mitchell's interview with Spitzer.
Trace the pump prices' roots in a Reality Check.
CBS Raw: Democrats react to Mr. Bush's proposals.
Senator Bob Menendez, D-N.J., says oil companies blamed an "act of God" for fuel shortages and price increases last year. Now he says it is "crystal clear that the current spike in gas prices is at least partly due to an act of greed." Spitzer called out oil companies for having "internalized all of the profit."

Menendez is proposing a 60-day suspension of the gasoline tax. He says repealing tax breaks for energy companies could cover the cost.

Meanwhile, the country's three largest oil and gas companies are expected to report combined first-quarter profits this week in excess of $16 billion, a 19 percent surge from last year that is sure to complicate life for the industry in Washington, where elected officials are scrambling for ways to assuage angry consumers and businesses.

And experts said Bush's actions wouldn't have much impact on prices at the pump. The president warned that motorists would have to dig deep into their pockets all summer long, tipping his hat to the reality of high prices, CBS News correspondent Jim Axelrod reports.

"Energy experts predict gas prices are going to remain high throughout the summer and that's going to be a continued strain," Mr. Bush said.

Continued



©MMVI, CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.
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