Bush dismisses gas 'rip-off' charges

• Article
• Comments ()
• Click-2-Listen
• Videos

By

President Bush yesterday rejected calls from Capitol Hill to levy a tax on oil-company profits and said there is "no evidence" of price gouging.

He urged the industry to increase oil exploration and to reinvest billions in earnings from high gasoline prices to build new refineries.

"I have no evidence that there is any rip-off taking place," Mr. Bush said at a morning press conference in the White House Rose Garden. "But it's the role of the Federal Trade Commission to assure me that my inclination and instinct is right."

Mr. Bush said calls to tax the oil industry's profits would take money that should be reinvested in refineries, pipeline construction for natural gas deliveries and exploration in "environmentally friendly ways."

"Look, the temptation in Washington is to tax everything, and they spend the money -- 'they' being the people in Washington," said the president, who has called on Congress to strip away tax breaks the corporations are enjoying amid record profits.

Mr. Bush said gasoline prices topping $3 per gallon and the rising cost of oil -- hovering above $70 a barrel, up from below $20 when the president took office in 2001 -- were "a wake-up call."

"We're dependent on oil, and we need to get off oil," he said. "And the American people have got to understand that we're living in a global economy, and so when China and India demand more oil, it affects the price of gasoline at the pump. And, therefore, it's important for us to diversify away from oil."

He blamed oil companies, who this week announced profits in the tens of billions of dollars, for squeezing supply by failing to reinvest profits to ease demand. On Thursday, Exxon Mobil, the nation's largest oil company, announced earnings climbed by 7 percent to $8.4 billion during the January-March period.

The president noted that no new refineries have been built since the 1970s, limiting the amount of crude oil that can be converted into gasoline, and has asked Congress to ease regulatory restrictions to allow oil companies to move swiftly.

"My attitude is that the oil companies need to be mindful that the American people expect them to reinvest their cash flows in such a way that it enhances our energy security," Mr. Bush said.