Share this article

print logo

Check the oil; Iran is a big player in rising costs, but a federal investigation could help

As gas prices continue reaching new highs and lows in the presidential campaign discourse, the most productive use of any politician's time might be to do what New York's Sen. Charles E. Schumer has been touting since last year.

That is, his clarion call for the Federal Trade Commission to launch an investigation as to whether refineries are engaging in illegal practices that, as he said last year, "could be costing drivers dearly at the pump."

The FTC investigation is currently going on, and while it is not known when the results will be released, it may shed some light on whether illegal practices are in fact causing prices to go up at the pump -- specifically, whether the refineries were intentionally refining less oil into gasoline in an attempt to keep supply low and prices high.

Republicans have glommed onto the president's rejection of the Keystone XL pipeline, which would have carried oil from Canada to refineries in Texas. President Obama would have done himself a world of political good, not to mention the addition of potentially thousands of jobs, had he moved forward with the pipeline.

But the Keystone XL still has a chance of being addressed after the November elections. Time will tell who picks up that ball and, what is more, Obama's approval of it would have done nothing to help the current situation. Indeed, he has already directed his administration to ramp up U.S. oil production by extending leases in the Gulf of Mexico and off Alaska's coast and by holding more frequent lease sales in a federal petroleum reserve in Alaska. And, as the Gulf of Mexico disaster showed, it pays to be careful in sensitive areas.

Meanwhile, there's the oil specter of Iran.

As gas prices cruise higher toward $5 a gallon in some parts of the country, a straight line can be drawn to Iran's role. GOP presidential candidates are staunchly against Iran's attempts to acquire a nuclear weapon. U.S. and European sanctions against the country and its oil exports have played a significant role in higher prices.

Again, Schumer's call over the last week to get the Saudis to pick up their supply ought to be heeded. Not exactly friendly with the Iranians, it would be in the Saudis' interest to signal that they would make up the potential shortfall in the event Iran's supply was stopped. It would send a positive signal to the financial markets and perhaps edge down gas prices.

Calculating this latest gas equation leaves one pondering a solution. Releasing oil from the Strategic Petroleum Reserve, as the president did during the Libyan conflict last summer, would seem extreme because this measure is generally used by presidents in dire emergencies. It is an option, though not the best.

Despite America's belt-tightening that may prevent this latest surge from wreaking havoc over family finances, the rising cost of gas is an immediate problem that has to be solved. One way to do that is for Congress to be more proactive in its approach.