“As ranking member of the Agriculture Subcommittee that oversees the U.S. Commodity Futures Trading Commission, I have a responsibility to ensure speculators are not exploiting oil supply fears to make big profits,” Boswell said in a prepared statement.

“The CFTC determined in 2008 that Wall Street speculators were increasing their positions in energy markets to capitalize off of political unrest in heavy oil-producing nations. Energy prices drive up the cost of goods across the board — from input costs on the farm to the food on the kitchen table. I am calling for a hearing to make sure that Wall Street and Big Oil are not purposely driving up prices once again to make a quick buck on the backs of the middle class and small business owners who are hit the hardest when the price of gas skyrockets.”

Boswell and U.S. Rep. Peter Welch of Vermont co-authored a letter to Agriculture Committee Chairman Frank Lucas (R-Okla.) and General Farm Commodities and Risk Management Subcommittee Chairman Mike Conaway (R-Texas). Both GOP leadership members represent states that hold a special interest in the oil industry’s success, but Boswell remained optimistic that his request would be given serious consideration.

“The Agriculture Committee has a history of investigating oil speculation when gas prices reach record levels, regardless of what party is in charge,” he said. “It is my hope that Committee leadership will take the issue of rising gas prices seriously, as well as our hearing request, and allow daylight to be shed on this important issue.”

In addition to Boswell and Welch, the letter to leadership was also signed by Democratic U.S. Reps. Tim Walz of Minnesota, Terri Sewell of Alabama, James McGovern of Massachusetts, Bill Owens of New York, Joe Courtney of Connecticut and Larry Kissell of North Carolina.

The full text of the letter appears below:

Dear Chairmen Lucas and Conaway:

We are writing to request the Committee conduct a hearing to examine the recent rise in energy prices, particularly for oil and gasoline. The American public wants reassurance that these high prices are completely attributable to market forces and not due to speculation or manipulation in the futures or spot markets for energy.

The Agriculture Committee, which has jurisdiction over the Commodity Futures Trading Commission, has a long history of examining rises in energy prices and how they impact the agricultural sector. Since 2006, the Committee has held three hearings on this issue, under both Republican and Democrat majorities, which only further demonstrates the bipartisan commitment of the Committee to examine drastic price fluctuations in the price of oil.

In the last four months, oil prices have risen to date by 25% and we have not yet reached the summer peak season when oil and gasoline prices experience further increases. On March 31st, the House Committee on Natural Resources held its own hearing looking into rising gasoline prices. At that hearing, witnesses including Mr. William P. Graves on behalf of the American Trucking Association and Mr. Michael J. Fox, Executive Director of the Gasoline & Automotive Service Dealers of America raised concerns about continuing speculation in today’s energy markets.

Given the increase in energy prices and continued concern about speculation in energy markets, we believe it is appropriate and imperative that our Committee conduct its own hearing into energy prices and bring in representatives from the CFTC and the Department of Energy who can give us their views regarding what is occurring in the energy markets. We look forward to working with you to bring such a hearing to fruition in the immediate future.

Sincerely,

Rep. Leonard Boswell (IA-03)
Rep. Peter Welch (VT)
Rep. Tim Walz (MN-01)
Rep. Terri Sewell (AL-07)
Del. Gregorio Kilili Camacho Sablan (Northern Mariana Islands)
Rep. James McGovern (MA-03)
Rep. Bill Owens (NY-23)
Rep. Joe Courtney (CT-02)
Rep. Larry Kissell (NC-08)

In 2009, drivers spent less on gas than in recent years:

Drivers in 2009 spent a markedly lower percentage of their income on gasoline than they did in 2008, and drivers in all but five states actually spent a lower percentage than they did in 2006. This is largely due to the fact that gas prices went down, dropping from the record high prices we saw in 2008. This is a notable change in the trend of the past few years, which saw increasing vulnerability. But with gas prices once again beginning to rise, vulnerable states will be even more at risk.

There has been an ongoing fight behind the scenes for months on the issue, with the ethanol industry arguing for high ethanol blends and others, including the oil industry, raising questions about the impact of higher ethanol blends on engines and the possibility that consumers will “misfuel’ by putting E15 in vehicles made before 2007.

In order to assuage these concerns, EPA is making efforts to properly label E15 pumps. According to a statement from the agency:

Additionally, several steps are being taken to help consumers easily identify the correct fuel for their vehicles and equipment. First, EPA is proposing E15 pump labeling requirements, including a requirement that the fuel industry specify the ethanol content of gasoline sold to retailers. There would also be a quarterly survey of retail stations to help ensure their gas pumps are properly labeled.

EPA Administrator Lisa Jackson made her decision after reviewing testing by the Department of Energy on the impact of higher ethanol blends on engines and their impact on greenhouse gas emissions. EPA says it will make a decision on granting such a waiver on model year 2001-2007 vehicles, but it will not grant a waiver this year for vehicles made before 2001.

Natural Resources Defense Council Executive Director Peter Lehner, in a blog today, said this goal is achievable.

We can achieve 60 mpg by 2025 using and improving on technologies that already exist such as hybrid electric cars. And, of course, we have the know-how to do it without compromising affordability, safety, or consumer choices.

And he says new standards will help reduce the country’s dependence on foreign oil:

Not only will they save drivers money at the pump and make America’s car industry more competitive, but they will also dramatically reduce our need for foreign oil and cut down on global warming pollution. By 2030, it will cut our oil consumption by 49 billion gallons per year and more than 535 million metric tons of carbon pollution.

The letter comes as the Obama administration is expected to release new fuel efficiency rules later this month.

According to the Post, some stations in the Gulf saw their sales drop 50 percent after the spill. Now, the Post says, sales are down about 10 percent in the Gulf and even less in the rest of the country.

The Post checks in with John Kleine, head of the BP Amoco Marketers Association, a group that represents the owners of BP gas stations:

Kleine, who calls the station owners “investors” in BP’s brand (their only link with the company is contracts to buy gasoline), said they began facing angry protests after the spill and turned to BP for help. The company gave them signs and took out print and radio advertisements emphasizing that the stations were locally owned and operated. At some stations BP helped the owners do customer appreciation campaigns with free car washes and cups of coffee. Corporate staffers flew in to stand in driveways and listen to customers’ concerns, Kleine said.

But Joe Romm counters that the program will pay for itself in less than five years, and so we’re essentially making environmental gains at no cost. Cash for clunkers is expected to save around 72 million gallons of gasoline each year. At $3 a gallon (Romm considers this a conservative estimate for the coming years), that amounts to $216 million in annual gasoline savings. At this rate, the $1 billion that’s been allocated to cash for clunkers so far would be more than paid for in a half decade.

Romm maintains that cash for clunkers is not primarily an environmental program, though its green benefits are certainly a plus. Instead, it has important economic and national security implications:

The majority of the $200+ million a year in gasoline savings would have left the country, since we import nearly 2/3 of our oil (and probably a higher fraction of marginal increases in oil use). Now that money stays in the pockets of consumers, who will save some of it and spend the rest of it, circulating most of the money in this country rather than overseas.

Liberal environmentalists have been highly skeptical of the program’s modest fuel-economy provisions, which require an efficiency improvement of just 4 miles per gallon. But so far, the average gain from the program’s trade-ins has been nearly 10 miles per gallon. Despite quibbles over the details, there seems to be a growing consensus about the program’s overall effectiveness.

The autos and the utilities could have a nice little symbiotic relationship. While the auto industry has something to build, utility companies have another place to sell their product.

The utilities are hoping for a major shift in vehicles from gasoline to electricity. If such a shift takes place, according to the Pacific Northwest National Laboratory, oil imports would drop by 52 percent.

The talks are exploratory right now, but worth watching.