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Gasoline Prices: New Legislation and Proposals (CRS Report for Congress)

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Release Date Revised June 2, 2006
Report Number IB10134
Authors Carl E. Behrens and Carol Glover, Resources, Science, and Industry Division
Source Agency Congressional Research Service
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Summary:

As gasoline prices shot over $3.00 a gallon following Hurricane Katrina, Congressbegan to revisit the energy issue despite having just passed the massive Energy Policy Actof 2005 (H.R. 6, P.L. 109-58). Katrina caused shutdown of refining capacity in the Gulf ofMexico area and closed some pipelines, as well as disrupting oil and gas production offshore.By September 22, many refineries closed down again because of Hurricane Rita. Afterthe storm, significant amounts of refining capacity remained shut down, and it was uncertainhow soon it would return to operation. (For details see CRS Report RS22233, Oil and Gas:Supply Issues After Katrina and Rita, by Robert L. Bamberger and Lawrence Kumins.)Meanwhile, following seasonal patterns, consumption of gasoline fell from a peak of nearly9.5 million barrels per day (mbd) in July to about 8.8 mbd in September (See Figure 2).At hearings by the Senate Energy and Natural Resources Committee September 6 andthe House Energy and Commerce Committee on September 7, suggestions for furtherlegislation to deal with the energy crisis included reexamination of fuel economy standardsand expanding off-shore oil and gas production beyond the Gulf of Mexico. Also of concernwere allegations of price gouging by gasoline retailers and distributors.On September 28, the House Energy and Commerce Committee reported out H.R. 3893,the Gasoline for America's Security Act of 2005. The bill would amend environmentalregulations for construction of facilities such as refineries, provide for designation by thePresident of potential sites for refineries on public lands and closed military bases, limit localdesignation of special components of gasoline, and strengthen the Federal TradeCommission's powers to investigate price gouging. The bill was passed by the HouseOctober 7 by a vote of 212-210.Also on September 28 the House Resources Committee approved a bill that would liftthe moratorium on leasing and production of natural gas in the Outer Continental Shelf(OCS), and allow states to opt out of the moratorium on production of petroleum. However,plans to bring the legislation to the House floor along with H.R. 3893 were dropped October3 in the face of opposition to the natural gas provision.
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