President offers up oil reserves, says more needed

President Bush yesterday offered to open U.S. oil reserves to alleviate fuel shortages caused by Hurricane Rita, but said the United States needs more refineries and less dependency on foreign oil to fix the nation’s “fragile” energy infrastructure.

“It’s important for our people to know that we understand the situation and we’re willing to use the Strategic Petroleum Reserve to mitigate any shortfall in crude oil that could affect our consumers,” the president said after meeting with Energy Secretary Samuel W. Bodman and Interior Secretary Gale A. Norton.

The president said initial reports from the hurricane-battered Gulf Coast, which produces more than a third of U.S. fuel, were encouraging, and most refineries will be operating at or near capacity by week’s end. However, the United States still faces a dire energy dilemma that presents long-term problems.

“The storms have shown how fragile the balance is between supply and demand in America,” he said.

The two powerful hurricanes, Katrina and Rita — which damaged refineries and oil platforms, stranding millions of barrels of oil in the Gulf Coast — “show that we need additional refining capacity … to be able to meet the needs of the American people.”

Capitol Hill Democrats were skeptical of the president’s call for refinery expansion.

“The major oil companies haven’t even tried to build one single new refinery or significantly expand a refinery in this country in 30 years,” Senate Minority Leader Harry Reid said.

“They do not really want to expand refinery capacity because it would cut into their record-setting profits. The oil companies and their Republican friends in Congress want to use this tragedy to ram through their ideologically driven rollbacks of environmental laws that protect American families,” the Nevada Democrat said.

Democratic National Committee Chairman Howard Dean accused the president of lining the pockets of oil corporations.

“President Bush should do the right thing for America’s working families and stand up to his big oil cronies who are making record profits as gas prices surge,” he said.

But Mr. Bush, who was told over the summer by Saudi officials that the United States cannot handle more oil without increasing its refining capacity, said bureaucratic red tape has slowed construction of new refineries or expansion of existing facilities.

“I look forward to working with Congress, as we analyze the energy situation, to expedite the capacity of our refiners to expand and/or build new refineries,” Mr. Bush said.

The newest U.S. refinery, which turns crude oil into gasoline, was built in 1976. Gulf Coast oil refineries affected by Rita and Katrina represent 31 percent of national production, and hundreds of refineries in the region have been shut down, either as a precaution against Rita or by damage from Katrina.

The White House also said yesterday that the reduction in gasoline production caused by the two hurricanes supports the administration’s efforts to open up the Alaska National Wildlife Refuge (ANWR), which scientists say could hold up to 16 billion barrels of recoverable oil — and perhaps as much as 30 billion barrels.

“We’re talking about a small footprint within ANWR where they can expand our domestic production,” Bush spokesman Scott McClellan said.

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