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Tue, May 02, 2006 - Page 10 News List

US energy secretary says high gas prices will linger for years


Soaring gasoline pump prices are here to stay for at least the next couple of years and the government can do little in the short term to mitigate it, US Energy Secretary Samuel Bodman said on Sunday.

Opposition Democrats have lambasted the administration of US President George W. Bush for not having formulated a long-term energy policy and blasted oil companies for raking in multi-billion dollar profits.

"Suppliers have lost control of the market," Bodman told NBC television, in explaining how gasoline prices had risen as much as US$0.60 a gallon [3.8 liters], or at least 25 percent, in one month.

"We've got demand coming from China, from India, from the United States," reflecting strong economies, Bodman said.

He also noted that conflict in Iraq tightened crude supplies.

"Clearly we are going to have a number of years, two or three years, before suppliers are going to be in a position to meet the demands," Bodman said.

Bodman meanwhile rejected some lawmakers' allegations that consumers are being deliberately gouged by oil companies, and said popular calls to set a windfall profits tax on the companies would not work.

"This is one of those situations where I guess I would call it `trust but verify,'" he said.

Opposition lawmakers said the Bush administration should have diversified US energy sources, generated competition and prevented market manipulation by oil companies.

"We believe they are manipulating supply," Democratic Senator Barbara Boxer told CNN.

"You had 20 oil companies at one time; [now] you have five ... We need to inject some competition into the mix here," she said.

Republican Senator Trent Lott told CNN that the price rises stem from unabated consumer demand and lack of long-term polices.

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