WASHINGTON, April 25: President George Bush on Tuesday ordered an investigation into possible petrol price cheating and measures to improve supply to an American public that is increasingly angry over sky-high fuel costs.
Mr Bush suspended deposits into the US strategic petroleum reserve and allowed states to ease environmental regulations on fuel for cars. But he also took aim at oil companies that are recording huge profits as crude oil prices hit record highs.
The president, whose popularity is at an all-time low, announced the proposals in a Washington speech in which he reaffirmed his message that dependency on foreign oil is a ‘national security’ issue.
He said the Federal Trade Commission was investigating whether ‘the price of petrol has been unfairly manipulated in any way’.
Mr Bush vowed that his administration would ‘make sure that the American consumers are treated fairly at the gas pump’.
He acknowledged that a new spike in petrol prices has been felt across American society, hurting consumers and putting a damper on business.
But he also warned that fuel prices would remain high throughout the peak summer driving season ‘and that’s going to be a continued strain on the American people’.
He said stopping deposits into the strategic reserve, held in salt caverns on the Gulf coast, would help improve supply.
“The strategic reserve is large enough to guard against any major supply disruption over the next few months,” Mr Bush said in a speech to the Renewable Fuel Association, a group for producers of ethanol and other alternatives to oil.
“By deferring deposits until the fall, we’ll leave a little more oil on the market. Every little bit helps,” the US president said.
Mr Bush said he would allow the Environmental Protection Agency to provide waivers for using ethanol inside of MTBE as a safety additive to fuel.
He also called for a simplifying of regulations that mean different fuel mixes have to be produced for different regions. Most of this is to reduce pollution, and the proposal was criticised by environmental groups.
John Stanton, vice president of the National Environmental Trust, said: “Instead of cracking down on oil companies for price gouging, the president has opted to repeal clear air protections for asthmatic children at the outset of smog season.”
But Mr Bush also turned against oil companies in his speech and said he would cut two billion dollars’ worth of tax breaks for oil companies over the next decade.
Mr Bush said the tax breaks are not needed at a time of ‘record oil prices and large cash flows’.
He urged the companies to invest in increasing refining capacity, highlighting that no new refinery has been built in the United States for 30 years.
But he added that Congress also has to make it easier for companies to get permits for new refineries. He said permits should be ready within a year.
The president said the country also has to invest in alternatives to petrol, such as ethanol and hydrogen fuel cells.
While stressing that “petrol price increases are like a hidden tax on the working people” he suggested that consumers bear part of the blame for the soaring cost, saying that “the prices people are paying at the gas pump are a reflection of our addiction to oil”.
“Our addiction to oil is a matter of national security concern,” the president said, adding that about 60 percent of the United States’ oil comes from foreign sources, compared with just 25 percent 20 years ago.
“Some of the nations we rely on for oil have unstable governments or agendas that are hostile to the United States,” Bush said.
“These countries know we need their oil, and that reduces our influence, our ability to keep the peace in some areas.” —AFP
