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The Obama "Tyson Slocum" "Public Citizen"administration’s announcement today to expand offshore oil drilling is a terrible idea: It won’t lower oil or gas prices, and it puts taxpayers on the hook for accidents.

The last time the president made such an announcement, the BP disaster occurred two weeks later. We all saw how that ended. Obama should not be laying the groundwork for history to repeat itself.

Current law caps accidental spill liability at $75 million, far below what actual spill damages would likely be. This translates into a huge subsidy for the industry and puts the American people on the hook.

Congress has yet to pass reforms in the wake of that disaster – including raising oil companies’ spill liability from the current $75 million cap.

Opening new areas to drilling while failing to hold oil companies accountable for fleecing taxpayers on existing drilling leases is unfair.

Obama should know better than to hold Big Oil’s support above Main Street’s interests.

Tyson Slocum is Public Citizen’s Energy Program director. Follow him on Twitter @TysonSlocum.

"Tyson Slocum" "Public Citizen"It shouldn’t be much of a surprise when Big Oil tells us that our path to jobs and prosperity is to drill for more oil and natural gas. What is surprising is just how misleading its new multimillion-dollar advertising campaign is. But what the industry isn’t highlighting is that we are exporting record amounts of refined oil (gasoline and diesel) out of the U.S. In fact, recent news reports show that refined oil products are now the U.S.’s No. 1 export. We still import half of our crude oil needs, but anemic domestic demand combined with high domestic oil production has resulted in an oversupplied domestic market, providing incentive to refiners to export.

What does that do? It keeps prices high, of course. And that’s really what the oil industry is after: more drilling (without having to abide by rules prohibiting the fouling of the environment or the poisoning of people), more oil, more exports, high gas prices, more money.

We are awash in energy supplies. We are the third-largest oil producer on the planet, and the second-largest natural gas producer. But we remain the largest consumer of fossil fuel energy, which is unsustainable from the standpoint of price, climate, water use and our environment.

Who loses? You, me and everyone else who gases up at the pump. We will lose even more if the Keystone XL pipeline is approved. That’s just a conduit to export even more gasoline, because it will be piped from Canada to the Gulf Coast refineries then put on ships.

The problem is not inadequate access to domestic resources. It’s that we still don’t have enough clean alternatives. We need to invest more in rooftop solar and wind power. We need to develop more mass transit and more electric cars. We need to wean ourselves off oil.

So don’t be fooled by the slick ads. The message is just more of the same from a polluting, deceptive and price-gouging industry that is focused solely on its bottom line. American families can’t afford Big Oil’s status quo.

Tyson Slocum is Public Citizen’s Energy program director.

 

 

A divided U.S. Commodity Futures Trading Commission (CFTC) delivered soft rules that won’t take effect until who-knows-when. But consumers aren’t divided that Wall Str"Tyson Slocum CFTC position limits"eet-driven commodity speculation is killing our economy. It is now time for Congress and the president to step in and order the CFTC to deliver stronger position limits to protect our economy and hold Wall Street accountable.

As thousands of Americans occupy Wall Street, Wall Street banks occupy our government. Fresh evidence is the CFTC’s long-delayed rule that fails to effectively crack down on the excessive speculation that has defined energy trading markets.

Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act, which included mandatory position limits with the understanding that unregulated energy markets allow Wall Street banks to play a role in encouraging excessive speculation. Such speculation increases prices paid by households, and Benjamin Bernanke, chairman of the Federal Reserve, warned earlier this year that sustained high commodity prices pose a “threat” to America’s economic recovery.

Congress designed position limits as a central tool to eliminate excessive speculation and used the decades-old agricultural position limit rules as a model. Section 737 of Dodd-Frank orders that the CFTC “shall … establish limits on the amount of positions, as appropriate … [in order] to diminish, eliminate or prevent excessive speculation … [and] to deter and prevent market manipulation, squeezes and corners.”

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"Tyson Slocum oil futures"Note: The Wall Street Journal this week ran a story about confidential documents from the Commodity Futures Trading Commission that named traders who held oil futures in 2008, when oil prices spiked to record highs.

The growing controversy over the leaking of trading documents naming 219 investors in oil futures positions during the 2008 oil price spike shows two things.

First, the data reveals that excessive speculation by banks and others is the driving force in oil markets, pushing prices beyond the supply-demand fundamentals. Who wins when prices rise? Wall Street traders that are engaged in speculating. Who loses? Every consumer who fills up at the pump.

Second, this data shows that we need this information to be made public on a regular basis. The companies named – including Goldman Sachs and Morgan Stanley – were significant players in the 2008 price run-up. The public should know who is responsible for high gas prices. It should get this information not just now, three years later, but on a regular basis, within two weeks.

Far from heeding the hysterical calls of corporations that are rushing to use the dissemination of three-year-old records as an excuse to crack down on the Commodity Futures Trading Commission, lawmakers should work with the agency to shine light on the sordid business of oil speculation. For too long, major corporations have reflexively deemed vast swaths of data “proprietary,” thereby removing critical information from the public domain. Company-specific energy trading information should be public to help ensure more transparent markets. Even in equities, the identities of large individual shareholders are publicly disclosed. The same should be the case in commodities.

Further, the information revealed this week provides even more reason for regulators to fully enforce provisions of the Dodd-Frank Wall Street reform law that are designed to curb excessive speculation.

Tyson Slocum It’s unbelievable but true: The federal government can’t require companies to reveal what chemicals they are pumping into the ground (and sometimes the groundwater) when engaging in fracking.

Why? Corporate power of course. Powerful industry lobbyists managed to get fracking exempted from a host of laws that enable government agencies to enforce clean water standards and thereby keep drinking water safe. Fracking is a process in which water and carcinogenic chemicals are injected into the ground to force out natural gas.

The result is that in some communities, groundwater is contaminated (to the point of being flammable) and people have no way to find out what carcinogens they are injesting.

Today, Public Citizen made a raft of recommendations to the Department of Energy, which is examining fracking hazards. The bottom line is that it probably can’t be done safely. But right now, there are many loopholes that must be addressed.

For instance, in what is commonly known as the Halliburton loophole (named after the powerful company with ties to then-Vice President Dick Cheney) inserted into the Energy Policy Act of 2005, hydraulic fracturing was exempted from the Safe Drinking Water Act.

Here are a few things that need to be done:

•    Congress repeal the exemptions to major provisions of federal environmental laws that were carved out as favors to the oil and gas industry;
•    The Environmental Protection Agency assess the environmental and health impacts of chemicals used in fracking and regulate them or prohibit them accordingly; and
•    Drilling companies be required to disclose the amount of each chemical used at each well site, and the information be made available to the public.

You can read all our recommendations here.

Let’s hope the Department of Energy listens. Want to weigh in? Please do. We need your voice.  Tell your representative to support efforts to remove the exemption to the Safe Drinking Water Act for fracking and call for the disclosure and monitoring of the chemicals used in the process.

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