Frank Pallone: “Frankly, I have no idea why this amendment is being offered. It would force the Department of Energy to ride the roller…”

“Frankly, I have no idea why this amendment is being offered. It would force the Department of Energy to ride the roller coaster that is the oil future's market, without any option to just pay a simple fixed price for a barrel of oil. If oil goes up $20 per barrel between when DOE purchases oil for the Strategic Petroleum Reserve and when it is delivered, well, that is too bad. We are now paying $20 per barrel more, and we will have to buy less oil. This amendment unnecessarily restrains DOE and makes purchasing petroleum products to refill the Strategic Petroleum Reserve more expensive. DOE recognized as much when it issued a rulemaking last fall clarifying that it could purchase oil at a fixed price, as common sense would dictate. There is no reason that it should be illegal for the Department of Energy to sign a contract saying that it will purchase oil for $70 per barrel. No reason that I can think of. Except, of course, if you are an oil company that wants the Department of Energy to pay more to refill the reserve. {time} 1615 However, if you are an average American, then this amendment is a raw deal. It constrains the Department of Energy's usage of the Strategic Petroleum Reserve, which is partially responsible for the tremendous over $1.50 per gallon fall in the cost of gasoline we have seen since last summer's peak gas prices. I will note that when the Department of Energy issued its notice of proposed rulemaking this last summer, industry did not object.…”