Saturday, April 19, 2008

Big 5 Oil Compinies Create Artificial Shortages of Gas and Diesel

Today while I was searching the net I came across the testimony of Timothy A Hamilton, before the Senate Judiciary Committee in Washington, DC on February 1, 2006

This is a link to the full story.

His remarks point out the ability of the major oil companies to control the availability and price we pay at the pump. Mr. Hamilton has been the gas station retail business since 1974. His experiences led him to a career change to become involved in governmental affairs and public policy in 1984 when he formed a non-profit trade association of independent gasoline wholesalers and retailers that operate approximately 400 gasoline service stations and convenience stores in Washington State this organization is called “AUTO”.

When any industry gains the power the “Big 5” has gained and then abuses that power for greed resulting in severe hardships for American Citizens it is time to “Vote to Regulate Gas and Diesel Prices” at the pump.

Mr. Hamilton states in his testimony “Decades of consolidation, regulatory lobbying and legal maneuvering by the industry following federal decontrol in 1981 has resulted in formation of international corporations that dwarf the Standard Oil Trust and other monopolies that gave birth to the antitrust concept. One can hardly criticize the drafters for failing to anticipate the evolution of PC computers, internet communications and other modern technology that currently allows the industry to legally use tacit collusion that nearly mirrors the monopolistic powers of the Standard Oil Trust. The same applies to envisioning that the industry would use environmental initiatives to meet, divide up markets, and create barriers to entry and other anti-competitive institutions.

To back up Mr. Hamilton’s statements he sites many ways the “Big 5” are able to track the movement and availability of product at any moment then use the information to create artificial shortages at any level they choose, ie., Local, Regional or even National.

A great deal of the American public has been led to believe there is a shortage of refining capabilities in the USA. Not True! Mr. Hamilton testified to how the “Big 5” export excess product to foreign countries and shut down or slow down production to keep the US available supply just above the demand. And, when that does not work well enough the “Big 5” are willing to shut down and destroy refineries.

A good example is Shell Oil’s attempt to bulldoze a highly profitable refinery near Bakersfield, CA. During the first meetings with employees of the refinery, the Shell spokesman claimed the company would never sell the plant. Bulldozing was the only way to assure a new competitor could not enter the marketplace. In the end, efforts by the California Attorney General resulted in a sale of the refinery to Flying J.

That is one refinery saved, one burned down and one blown up in the past few years. It does seem like the “Big 5” still prevail in their efforts to gouge the American public. When will you, my readers, say “Enough is Enough” and help launch this grass roots effort to “Vote to Regulate Gas Prices”.

People, I do not know the answers. I do, however, see the problem. We can all try to conserve our fuel consumption, but, as Mr. Hamilton testified the “Big 5” will just reduce the available supply.

We must have regulation to control prices at the pump. By not controlling the price at the pump everything we buy, every service we need must also increase prices due to the trickle down affect. To minimize the trickle down affect other companies must cut expenses wherever possible. That means fewer pay increases, increases in off shore manufacturing of goods to reduce labor costs, which in turn means fewer US labor jobs. The loss of jobs then creates hardships on families resulting in bankruptcies, foreclosures and the need for increased federal aid to those effected.

The “Big 5” has tipped the first domino in a complex US economy dependent on refined petroleum products . We need to step in and stop this domino affect and we need to do it now. Join me by helping with your constructive ideas as to how we can “Vote to Regulate Gas Prices” at the pump.

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