Panel Considers Gas Price Gouging The aftermath of Hurricane Katrina contributed to an increase in gasoline prices. A Senate panel examines charges of price gouging.

Panel Considers Gas Price Gouging

Panel Considers Gas Price Gouging

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The aftermath of Hurricane Katrina contributed to an increase in gasoline prices. A Senate panel examines charges of price gouging.

RENEE MONTAGNE, host:

This is MORNING EDITION from NPR News. I'm Renee Montagne.

Consumers have been facing sticker shock at the gas pumps. The Energy Department says since Hurricane Katrina, gasoline prices have jumped nearly 46 cents a gallon, pushing prices well over $3 a gallon. At a hearing on Capitol Hill yesterday, senators from both sides of the aisle expressed anger and concern at the prices. NPR's Brian Naylor reports.

BRIAN NAYLOR reporting:

Yesterday's hearing by the Senate Energy and Natural Resources Committee was actually called in August, before Hurricane Katrina, but at a time when prices were already rising. The storm, hitting the Gulf Coast and affecting both offshore oil production and closing down gasoline-producing refineries, only made matters worse. The administrator of the US Energy Information Administration testified the current spike in prices was temporary and said gasoline prices would go down once those refineries were back online. But some lawmakers on the panel were in no mood for such assurances. Democrat Dianne Feinstein of California listed some of the profits reported by oil companies in the first six months of the year: ExxonMobil, $31 billion; ConocoPhillips, $12.1 billion; BP, $20.9 billion. All the while, she said, consumers were being pushed to the brink.

(Soundbite of Senate hearing)

Senator DIANNE FEINSTEIN (Democrat, California): We see the price of oil is going to bankrupt airlines, destroy major legacy carriers, and it's just a question of time before it begins to destroy the economy.

NAYLOR: Other lawmakers expressed concerns for farmers and ranchers. Republican Lisa Murkowski of Alaska said Americans are paying $288 million more a day for fuel than they were last year.

(Soundbite of Senate hearing)

Senator LISA MURKOWSKI (Republican, Alaska): It's affecting us in our businesses, it's affecting the price of transporting our kids to school, it is affecting everything we do, and how this country operates. So we get to the point where we say enough is enough.

NAYLOR: Byron Dorgan, a Democrat from North Dakota, said a neighbor filled both of his cars over the weekend, 15 gallons in each, at a cost of $103. Dorgan says oil companies are reaping windfall profits and plans to introduce a bill to impose a windfall profits rebate on them.

(Soundbite of Senate hearing)

Senator BYRON DORGAN (Democrat, North Dakota): We can sit around and talk about this. There are a hundred reasons, I suppose, that people will have, this won't work, shouldn't be done. The question is, are you going to do nothing while we have an industry that's going to reap about $80 billion in windfall profits on a yearly basis? You're going to say that's fine, just ignore it, doesn't matter, and then have the American people pay it at the pump?

NAYLOR: Another Democrat, Maria Cantwell of Washington, says she plans legislation allowing the president to declare an energy emergency, giving him authority to look at the issue of pricing, which is currently regulated by the states.

There were no energy company executives at yesterday's hearing, although committee chairman Republican Pete Domenici of New Mexico threatened to call them in the future if price gouging is documented.

(Soundbite of Senate hearing)

Senator PETE DOMENICI (Republican, New Mexico): Let me say to any oil company that is price gouging, at whatever level, they will find themselves in those witness chairs, where they will be held accountable, if we can ascertain that such has happened.

NAYLOR: Other Republicans said government environmental regulations requiring different blends of gasoline for different regions of the country were also to blame for high prices, as was a moratorium on offshore oil drilling outside of the Gulf of Mexico. Republican Larry Craig of Idaho noted it's not just energy companies that are reaping big profits and that no one in Congress was calling for hearings on high real estate prices.

Brian Naylor, NPR News, the Capitol.

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