As the first heat wave passes through D.C. and the election draws nearer Congress has spun a web of confusion with hundreds of different solutions promising relief to the consumer at the pump – that is always expected.  What is frightening is the speed at which Representatives and Senators are authoring legislation, second guessing enacted law, and courting the press with misinformation.  Hearing after hearing has been called in every Committee that can justify jurisdiction over some part of the growing crisis.  NACS, for its part has testified 3 times this year:

• April 3, 2008 John Eichberger testified before the Senate Committee on Energy and Natural Resources regarding the effects of crude oil prices on retailers
• May 7, 2008 Bill Douglass testified before the House Judiciary Committee’s Anti-Trust Task Force on retail gas prices and consumer effects
• May 15, 2008 Tom Robinson testified before the House Judiciary Committee’s Antitrust Task Force on H.R. 5546, the Credit Card Fair Fee Act, relating rising interchange rates to the price of gas

It is prime time for any elected official to tout their disgust with the current energy situation in our country and the blame is being thrown around like a game of hot potato.  It’s Republicans vs. Democrats, Environmentalists vs. Supply Fundamentalists, and even region vs. region.  There’s the coal-to-liquids debate, the oil shale debate, the speculation debate, the gas tax debate, the ANWR and OCS debate, the OPEC debate, the renewable fuels debate, the strategic petroleum reserve debate- the list goes on.  

A quick update on NACS point of view:

• Gas Tax Holiday - this could not be a worse idea for the consumer and the retailer.  It is a purely politically motivated “solution” that would end up saving the consumer little to no money in the end. The consumer would expect to see an automatic drop of 18.4 cents per gallon, but wholesale price volatility could render such a drop in price impossible.  We can only predict the claims of gouging that would soon follow.  Not to mention the potential supply shortages as the customer runs to stock up while the price is lower.  And what happens when the tax holiday ends, how does the consumer feel then? NACS does not support this idea in any form.
  
  
• Price Gouging Legislation - While we see no need for such a law, the Senate version of the bill which was agreed to late last year provides retailers with the ability to react to market conditions in a competitive marketplace.  NACS continues to prefer this legislation over any that was passed in the House last year.  On June 24, 2008 the House Democratic Leadership brought up the same price gouging legislation from last year for a floor vote in an effort to publicize how “much” they are doing for consumers.  The legislation failed to reach the needed 2/3 majority to pass under suspension of the rules.
  
  
• Crude Oil Prices – NACS has testified at several Congressional hearings concerning retail gasoline prices and the negative impacts of high crude oil prices on retailers. Each time, NACS has noted that the transfer of investment capital from traditional vehicles (stocks and real estate) to “safe haven” commodity markets has inflated the price of crude oil. To address this issue, NACS has joined others in the industry supporting greater transparency of commodity market trading activity and called for an increase in crude oil supplies to reduce the attraction of commodity markets to these investors.

It’s important for us to keep ahead of the storm.  If you know of any issues in your area that NACS should be aware of as potential federal problems please let us know.  For more in depth position papers on all fuels issues please see the NACS Government Relations Issue Briefing Book (PDF).