When oil prices climbed above $37 a barrel in September 2000, President Clinton ordered the release of oil from the Strategic Petroleum Reserve to halt the climb, and the Republicans accused him of doing it to help the election chances of Al Gore. George W. Bush joined the attack, promising never to use the reserve to counter oil pricing. The big oil companies sided with him.
“The Strategic Reserve,” Bush said then, “is an insurance policy meant for a sudden disruption of our energy supply or for war. Strategic Reserve should not be used as an attempt to drive down oil prices right before an election. It should not be used for short-term political gain at the cost of long-term national security.”
Oil prices last week reached $75 a barrel, twice the September 2000 level, and a poll over the weekend showed that the president’s job-approval rating had slipped to 32 percent.
Sixty percent said he was doing a poor job, and about the same percentage said gasoline prices were causing them hardship. We are heading into midterm elections, where Bush’s presidency hangs in the balance, and people are angry.
“Never” arrived a little further ahead of the election this year than in 2000.
Yesterday, Bush announced that he was halting the diversion of oil into the reserve for the entire summer in the hope that it would increase gasoline supplies and at least slow the rise in oil prices.
The energy crisis has been worse, but the political crisis is at boiling point. To emphasize it, the president pointedly brandished a few other Democratic weapons: a Federal Trade Commission and Justice Department investigation of price fixing and gouging by the oil companies. A few Republicans lately have been calling for a windfall-profits tax on the oil companies after Exxon Mobil reported the highest quarterly profit of any corporation in world history. Profits in this quarter will be even higher.
Except for the release of more oil imports for immediate commercial production, which may slow the climb in gasoline prices ever so slightly, nothing will come of any of it.
As it happens, the FTC has been engaged in a study of oil prices for nine months and will report its initial findings in a few weeks. As for a windfall-profits tax, George Bush need not worry about choosing whether to sign or veto it because no Republican Congress will ever pass such a law. Not since the brief heyday of the progressive prairie Republicans between the great wars has even a tiny cohort of Republicans been willing to impose excess-profits taxes or war-profiteering penalties on any corporation.
But let us celebrate Mr. Bush’s announcement anyway. Consumers may never be able to quantify it, but they will be a trifle better off as a result.
Here is why: The industry now is on notice that its president and party are in deep trouble and they need help. We think that the producers, suppliers and marketers will discover that those usually irreversible market forces will permit them to rein in their greed for a while and they will come to Bush’s aid.
But don’t hold us to it.
