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Energy Secretary: Oil Companies ‘Have Lost Control of the Market’

by Pamela Leavey

On Meet The Press today, in a special one hour “in-depth discussion on Gas Prices,” Energy Secretary Samuel Bodman did not have good news on the future of oil prices. As a matter of fact the news was downright depressing. Grin and bear it, folks — tighten up the belts and the budgets because it looks like we could be in for a long ride — no pun intended. The Bush administration in sleeping with the oil whores have managed to create a fine mess…

Bodman acknowledged on Meet The Press, that, “at least for now, ‘the suppliers have lost control of the market.'”

The oil has gone up because the suppliers are unable to make the flows equal to the demand,” he said. “… Clearly, it’s going to be a number of years, maybe two to three years, before suppliers are going to be able to keep up with those demands.”

Bodman tried to shift the blame to demand from China and India, and added that “reduced refining capacity after Hurricane Katrina, and inadequate planning for shifts to cleaner fuels like ethanol and low-sulfur diesel for causing market “dislocations” that led to rising prices.” However, Red Cavaney, president of the American Petroleum Institute, the industry trade group, admitted that “the war in Iraq played a major role, too.”

Senate Minority Whip Dick Durbin was on the money saying that “the price of gasoline had almost doubled since Bush took office.”

“All of these things were predictable,” he said, pointing to provisions of the energy bill Bush signed last year, which did not shield producers of cleaner-fuel additives like MTBE from legal liability, thereby slowing the transition and squeezing gas supplies.

“We’ve had a failure in our nation’s energy policy,” Durbin said.

MSNBC provided a hard look at “Who pays what” with a comparison of how the rising prices at the pumps affect various income levels, showing that the poorest of American’s are affected the most.

Energy prices affect some people more than others. Here’s how rising costs hit Americans as a percentage of their income:

Income — Energy Costs* — Percentage of budget
Less than $5,000 — $1,460 — 28 percent or more
$5,000-$9,999 — $1,554 — 15 percent to 31 percent
$10,000-$14,999 — $1,954 — 13 percent to 20 percent
$15,000-$19,999 — $2,215 — 11 percent to 15 percent
$20,000-$29,999 — $2,556 — 9 percent to 13 percent
$30,000-$39,999 — $2,905 — 7 percent to 10 percent
$40,000-$49,999 — $3,231 — 6 percent to 8 percent
$50,000-$69,999 — $3,689 — 5 percent to 7 percent
$70,000 or more — $4,645 — no more than 7 percent

And the NY Times reports, “As Gas Prices Go Up, Impact Trickles Down.” Personally, I think the trickle down effects are just starting to show up. As the prices continue to rise for gas, so too will other prices on basic consumer goods and neccessities — like food, as shipping prices will continue to rise. The effects of higher gas prices will take a greater toll on small business, just as they have a greater affect on the low income folks.

So, as I said above, tighten up your belts and your budgets, my friends, this could be only the beginning.

UPDATE: The NY Times reports “The Senate Republican plan to mail $100 checks to voters to ease the burden of high gasoline prices is eliciting more scorn than gratitude from the very people it was intended to help.”

Aides for several Republican senators reported a surge of calls and e-mail messages from constituents ridiculing the rebate as a paltry and transparent effort to pander to voters before the midterm elections in November.

“The conservatives think it is socialist bunk, and the liberals think it is conservative trickery,” said Don Stewart, a spokesman for Senator John Cornyn, Republican of Texas, pointing out that the criticism was coming from across the ideological spectrum.

Angry constituents have asked, “Do you think we are prostitutes? Do you think you can buy us?” said another Republican senator’s aide, who was granted anonymity to openly discuss the feedback because the senator had supported the plan.

3 Responses to “Energy Secretary: Oil Companies ‘Have Lost Control of the Market’”

  1. Am I the only one who remembers the 2000 Presidential Debates. In one of his wise-ass answers, Georgie Boy proclaimed that he would not let foreign nations hold America hostage over oil.
    But as our despot would note, he never said anything about oil companies holding America hostage

  2. OC Dem

    I think many of us tried to point out during the ’04 election that he was not a man of his word – sadly not enough people listened. :(

  3. […] port has a piece exposing Bush’s willful lawbreaking. Democratic Daily tells us that the Energy Secretary says oil companies have lost control of the market. Democratic Underground tells […]