Before nearly 40 million Americans having hit the road for a trip lasting at least an hour this Memorial Day weekend, federal lawmakers passed legislation to punish oil companies raising prices unfairly at the gas pump.
The House earlier this month passed the Consumer Fuel Price Gouging Prevention Act gives the President the power to declare an “energy emergency” when events cause supply restrictions for consumer fuels, such as car fuel, aviation fuel, home heating oil, and liquid propane.
The bill makes it illegal to sell these fuels at excessive or exploitative prices during such an emergency. It gives the Federal Trade Commission the power to penalize companies for price gouging and prioritizes companies with total sales in excess of $500 million annually for these penalties.
Pain at the Pump
“Every New Jersey resident who has filled up their gas tank in the last two months understands that prices are excessively high,” said Rep. Donald M. Payne, Jr. “But there is no incentive for oil and refining companies to increase production, lower prices, and help American consumers.”
Rep. Tom Malinowski stressed the bill protects independently-owned gas stations for taking the blame for fuel price increases caused in the supply chain.
“Oil and gas companies are making record profits while ordinary Americans bear the full economic cost of Russia’s war in Ukraine,” said Malinowski. “If there is any evidence of price gouging, I want the government to have the tools it needs to protect consumers, even as we work to bring the supply of oil back into balance with demand.”
Payne noted that oil and gas companies have announced the profits while families are struggling to pay higher prices at the pump in the middle of Russia’s invasion of Ukraine.
“They have no problem robbing hard-working American families and using that money for stock buybacks and executive bonuses,” said the Newark native. “But this bill would bring some needed accountability into the oil market and keep prices reasonable during a fuel emergency like the one we have today.”
Focus on Big Oil
Malinowski added the pain at the pump is happening while the largest seven oil companies announced buybacks that could total $41 billion this year alone and the top five announced profits of $35 billion these past three months.
“Big Oil companies have been openly bragging to investors that they are prioritizing stock buybacks and dividends instead of increasing production and lowering costs at the pump—as recordings of Big Oil CEOs on their shareholder earnings calls have shown,” he said.
The bill comes at the same time the congressman from the 7th Congressional District has questioned the relationship with Saudi Arabia, criticizing them for being more aligned with Russia instead of working with the Biden Administration to increase oil production and help stabilize energy markets.
$4.60 A Gallon
“One reason New Jerseyans are paying more than $4 a gallon for gas is that Saudi Arabia and the UAE are deliberately helping Russia, and undercutting our sanctions, by refusing to increase oil production to meet global demand,” said Malinowski. “It is time we start acting like the superpower in these relationships and exert the influence that our investment in the security of these oil producing states warrants.”
The statement comes as gas prices have hit record highs across the U.S. The national average is $4.60 according to AAA on May 26. New Jersey ranks 12th with an average price of $4.76. The highest average is in California at $6.07; the lowest is Oklahoma at $4.10.