Gas prices and a letter to my senator

Below is a response to a email I sent to my senator that I found on AFA. I wondering how long will it take for us to feel the effects or if we will feel the effects. If Obama is elected we may not see a change except for higher prices. Anyways, you can go to AFA website and send the letter they have there and let your senator and state rep. know how you feel.
Kathy

Thank you for contacting me regarding the price of gasoline and diesel. I welcome your thoughts and comments on this issue.

Almost 75 percent of the price of a gallon of gasoline or diesel depends on the price of oil. Other costs factored into the price of fuel are taxes, distribution and marketing costs, and state and federal taxes. While supply and demand play a large role in the price of fuel, there are measures that can be taken to reduce the cost of gasoline and diesel.

I support a strategy that combines conservation, the development of alternative sources of energy, and an increase in domestic oil and gas production. I have recently introduced legislation that would allow for production of domestic resources in the Outer Continental Shelf (OCS) and the Arctic National Wildlife Refuge (ANWR), both of which are areas that are off limits to domestic production. Combined, these areas contain over 125 billion barrels of oil and as much as 565 trillion cubic feet of natural gas. The domestic oil reserves in both the OCS and ANWR, when combined with existing U.S. reserves of 21 billion barrels, is more than Iran's total oil reserve of 136 billion barrels. However, we cannot produce these domestic resources, because Congress has enacted a moratorium on production in these areas. The legislation will repeal this misguided policy and allow for production of these critically important resources.

Conservation measures, corporate average fuel economy standards, and the use of advanced cellulosic ethanol must all play a key role in our energy policy. There is no silver bullet to our energy needs. The U.S. must maintain a comprehensive policy that includes everything from production, to conservation, to alternative sources.

On April, 29, 2008, I sent a letter to President Bush urging the administration to immediately halt deposits of domestic crude oil into the U.S. Strategic Petroleum Reserve (SPR). Temporarily halting deposits into the reserve can provide relief by increasing the supply of domestic oil available for refinement into gasoline and diesel fuel. While this is not a long-term solution, halting SPR deposits will show that the U.S. Government will take necessary measures to address the exorbitant crude oil prices that negatively affect the global economy. In response to Congressional pressure, the U.S. Department of Energy announced on May 16, 2008, that it will not sign royalty-in-kind contracts this year for the receipt of up to 13 million barrels of crude oil to the SPR. By not entering into these new contracts, no oil will go into the SPR the rest of this calendar year, which allows more oil to enter the U.S. supply.

The U.S. Department of the Treasury is currently in the process of writing a regulation regarding the implementation of a tax deduction for expenses related to oil refinery expansion. With this tax incentive, refineries will be encouraged to expand their refining capacity, allowing more automotive fuel to enter the marketplace, and thereby bring down record high prices at the pump. This tax provision was enacted into law in the Energy Policy Act of 2005, but requires the Treasury Department to issue regulations before it can be used. In an effort to bring relief to consumers by increasing the supply of gasoline and diesel, I sent a letter to the Treasury Department urging their expedited promulgation of this regulation on May 28, 2008.

I appreciate hearing from you, and I hope that you will not hesitate to keep in touch on any issue of concern to you.

Sincerely,
Kay Bailey Hutchison
United States Senator