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On Profit and Pump Prices
James J. Mulva of ConocoPhillips, left, with Ross J. Pillari of BP America and John Hofmeister of Shell Oil, testified in front of two Senate committees yesterday. Top, oil company executives face congressional questioning under oath in 1974.
(By Melina Mara -- The Washington Post)
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In recent weeks, lawmakers have been talking tough about the oil companies, including Republicans who are usually friendly to their concerns. At the hearing, however, the Republican committee chairmen blocked a Democratic effort to put the oil executives under oath, which occurred in a 1974 hearing called to address oil shortages and high prices.
Sen. Mary Landrieu (D-La.) said the companies had done good work in helping the Gulf Coast recover from Katrina and Rita. "I know the heroic work that all of your companies did to save lives, to get people out of the gulf, out of harm's way," she said.
Perhaps the harshest criticism came from Sen. Barbara Boxer (D-Calif.), who displayed a large chart showing oil executives' multimillion-dollar bonuses. She asked if they would be willing to donate some of their earnings, along with their companies', to help low-income people pay higher energy costs. She did not allow time for a response.
The hearing, held in a cavernous, wood-paneled room, drew a large audience, including activists who wore shirts saying "Exxpose Exxon" and occasionally guffawed at executives' statements.
The executives used questions on prices and other topics to ask for more areas in the United States to be opened for drilling. They said more supplies would moderate prices. "The U.S. government should open areas currently off limits," said David J. O'Reilly, chief executive of Chevron.
A Senate budget measure includes a provision that would allow drilling in Alaska's Arctic National Wildlife Refuge. But last night, House leaders agreed to strip a provision allowing ANWR drilling from the House version of the legislation.
The hearing was held at the request of Majority Leader Bill Frist (R-Tenn). After the executives testified, however, Frist said in a statement that they "did not adequately answer the question of whether the sky-high gas prices we saw earlier this fall were entirely justified, and whether their companies' profit margins are appropriate given the hardships energy consumers are facing and will continue to face this winter."
By the end of the executives' testimony, Sen. Pete V. Domenici (R-N.M.) expressed frustration with executives' explanations for how oil is priced and asked for written information. "I hope you're expert enough to do a better job in writing that out than you were in answering it here," he said.
Yesterday afternoon, the chairman of the Federal Trade Commission told lawmakers that her agency has a congressionally mandated study underway to determine whether oil companies have been gouging consumers.
