Cantwell Reintroduces Legislation to Ban Price Gouging at the Gas Pump
Bipartisan proposal would improve transparency, protect consumers against market manipulation and unfair price spikes
WASHINGTON, DC - Wednesday, U.S. Senator Maria Cantwell (D-WA), along with U.S. Senator Gordon Smith (R-OR), reintroduced her legislation to ban gas price gouging. This set of tough new federal protections would guard against profiteering and market manipulation by oil and gas companies.
"It's hard for families to have confidence that rising prices are fair," said Cantwell, a member of the Senate Energy Committee. "We've sat through years of price shocks, with little transparency and no federal price gouging ban on the books. We need to act now and put these critical consumer safeguard in place to protect our economy and help families stay within their budgets."
"Gouging motorists at the gas pump is deplorable," Smith said. "There should be a strong mechanism in place to keep prices in check. We know we are vulnerable to spiking gas prices, especially in the aftermath of a natural disaster. However, a disaster is not a license to increase profits."
Based on Cantwell's measures to ban Enron-style manipulation schemes in the electricity industry, the anti gas price gouging legislation introduced Wednesday would empower federal regulators to ensure greater market transparency and go after companies that manipulate oil and gas prices. It would outlaw gas price gouging at all levels, and give the president the authority to declare national energy emergencies during which proven price gougers would be subject to new fines and criminal penalties. Currently, 28 states have similar laws, but a federal ban is needed to truly prevent harmful market manipulation. The legislation would not preempt these state laws.
Under the legislation, the Federal Trade Commission (FTC)—an independent regulatory agency—could conduct investigations and fine companies for price gouging. The specific definition of price gouging would be determined through FTC rulemaking. At present, there are no federal laws on the books that address price gouging for oil and gas.
Cantwell first introduced her bill to ban gas price gouging in 2005. In November of that year, her legislation garnered 57 votes as an amendment to the Tax Reconciliation bill—including the votes of 13 Republicans—but it required 60 votes for passage at the time. It was cosponsored by one-third of the Senate, and endorsed by eight governors and nine attorneys general.
The legislation introduced Wednesday by Cantwell and Smith is also cosponsored by Senators John Kerry (D-MA), Barbara Boxer (D-CA), Bill Nelson (D-FL), Claire McCaskill (D-MO), John Rockefeller (D-VW), Patty Murray (D-WA), Dianne Feinstein (D-CA), Joe Biden (D-DE), Debbie Stabenow (D-MI), Ron Wyden (D-OR), and Jack Reed (D-RI).
On Tuesday, regular gas in the Seattle area cost as much as $3.49 per gallon—$3.19 in Spokane and $3.39 in Portland—and prices could pass the $4.00 mark this summer. At $3.59 per gallon, Forks currently has the highest priced regular gasoline in the Pacific Northwest. In 2006, Cantwell also began looking into the significant gas and diesel price disparities between different parts of Washington state, and asked the FTC to investigate the matter. This in-depth investigation is still ongoing. Earlier this year, Cantwell joined Senator Feinstein in introducing bipartisan legislation (S. 357) to significantly improve fuel economy standards, and bipartisan legislation (S. 577) to enhance transparency in energy commodity trading—up to 80 percent of which is currently taking place beyond the reach of federal regulators thanks to the 'Enron' loophole.
Cantwell is working with her colleagues on both sides of the aisle to increase America's energy independence, level the playing field for new renewable and energy efficiency technologies, boost our domestic biofuels industry, and increase the availability of flex-fuel vehicles and biofuel pumps. Cantwell also believes that the U.S. government—the nation's single largest energy consumer—must lead the way toward energy independence by adopting the best available fuel efficiency and alternative vehicle technologies to reduce its own petroleum consumption.
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