The Real Reasons Energy Prices Are High, and What We Can Do

Jeff Bingaman
Chair, Committee on Energy and Natural Resources
U.S. Senate

One item of business before the Senate in May was S.2284, the Flood Insurance Reform and Modernization Act of 2007, a bill to reauthorize the federal law governing flood insurance. Attached to that was an amendment that did not relate to the subject of flood insurance at all. This was SA 4720, an amendment to S.2284 filed by Senate minority leader Mitch McConnell (R-Ky.), allegedly to deal with the high price of oil and the high price of gasoline at the pump. I opposed that amendment, and I am pleased that the Senate withdrew the amendment on May 13, 2008, for failure to achieve the required 60 votes.

The high price of oil, and the gasoline and diesel refined from that oil, is creating a substantial economic burden on the American consumer and on the U.S. economy. At the close of business Thursday, June 26, the price of oil stood at $140 per barrel, and the average price of gasoline was around $4 per gallon. This reflects a dramatic increase over prices a year ago. The increased cost is difficult for many Americans to avoid because many commute to work or otherwise need to travel substantial distances with no ready alternative to the use of their private vehicles. To the extent that Congress and the administration can take action to reduce the burden of this increased cost, we should do so.

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