WASHINGTON – U.S. Senator Pete Domenici, ranking member of the Senate Energy and Natural Resources Committee, today said that while there is no “silver bullet” that will bring down rising gas prices, there are long term steps that can be taken to ease the pain.

 

            Domenici addressed fuel supply issues at a hearing on the summer 2007 oil and gas outlook.  The Senator noted that while rising gas prices frequently bring heightened scrutiny to the question of manipulation, the main culprit is increased global demand coupled with less supply.

 

            “This week, the average price of a gallon of gas in this country is $3.10, which is obviously causing concern for drivers.  Unfortunately, this particular hearing has become as predictable as the cherry blossoms here in Washington.  We may not know exactly when, but you can bet that in the late spring, this committee will hold a hearing to talk about gas prices.  There is no silver bullet for this problem.  It has taken us a long time to get ourselves into this situation, and we will not get out of it overnight,” Domenici said.

 

            “When you import over 60 percent of your petroleum—much of it from countries that are not friendly to the U.S.—it is quite obvious that you do not control your own destiny.  That is the situation that we find ourselves in today.   In order to regain that control, we must increase production of domestic sources and build the infrastructure needed to deliver it to market,” he continued.

 

            Domenici noted that Congress took a major step forward with the passage of the Gulf of Mexico Energy Security Act of 2006, which allowed access to American oil reserves that is estimated to bring 1.26 billion barrels of oil and 5.8 trillion cubic feet of natural gas to market over the next several years.

 

 The Senator also pointed to legislation that he and Chairman Jeff Bingaman recently reported out of the Energy Committee.  The Energy Savings Act (S.1321) will dramatically increase the use of biofuels and aims to reduce gasoline consumption by motor vehicles 20% by 2017.

 

            “This part of our economy is like a big aircraft carrier steaming through the water—it doesn’t turn on a dime, and when it does turn, it may make a big wave that is going to rock some boats.  But we must have a comprehensive approach to meet our energy challenges, and that includes the use of alternative fuels to supplant gasoline,” Domenici said.

 

            Domenici also noted that refinery capacity remains a serious issue.  While industry plans to expand capacity b 2 million barrels per day at existing plants, increased demand is likely to offset gains in production. 

 

            “We have known for some time that we have been working with very little or no margin for error in terms of refinery capacity.  That is what happens when you go 30 years without building a new plant in the United States,” he noted.

 

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