Federal oil reserve off-limits for now > House Democrats meet with Energy official

WASHINGTON – Don’t look for the federal government to open the spigot on the Strategic Petroleum Reserve to alleviate the shortage of home heating oil – at least not yet and maybe not at all.

Battle lines are being drawn with the Clinton administration fearful of the market impact of opening the reserve, even just a little bit, and politicians under the gun in home districts to be sensitive to the concerns of increasingly chilly, energy-starved voters this winter.

Tuesday, more than a dozen House members put a critical spin on the stalemate.

In the morning, Rep. John E. Baldacci, D-Maine, was among the House Democrats who met with Energy Secretary Bill Richardson to try to get answers. Today, Sens. Olympia J. Snowe and Susan M. Collins, both Maine Republicans, will join other New England senators in meeting with Richardson. The goal: Gain administration concessions that doing nothing could jeopardize families using heating oil.

Rep. Edward J. Markey, D-Mass., said Tuesday residents faced “a choice between heating and eating” and Rep. Sam Gejdenson, D-Conn., said Congress needed to look more closely at what he called a “conspiracy between the oil companies and OPEC” – the Organization of Petroleum Exporting Countries – to jack up prices.

“We need to get some answers,” said Rep. Richard E. Neal, D-Mass., co-chairman of the New England Congressional Caucus. That group invited Richardson to Capitol Hill today to explain why the administration hasn’t proposed a solution.

The Energy Department is projecting costs to consumers will be 30 percent above last winter’s record levels while supplies continue to remain 40 percent below last year’s level. Several members of Congress said the increased prices and short supplies could result in an additional $150 to $600 in added-cost per household this winter.

During Richardson’s visit with the House Democratic Caucus energy working group Tuesday, Baldacci told the Energy secretary that oil from the Strategic Petroleum Reserve needs to be released now so it can be put in the pipeline, refined and made available to heating oil customers before winter.

“Stocks must be built up so there is enough on hand to provide a cushion and avoid a repeat of last winter’s run-up in prices,” said Baldacci.

Richardson repeated the administration’s take, however, that while there is a “price problem” it does not reach the threshold of concern that should trigger the release of oil.

Emerging from the caucus, Richardson said he remained “open” to finding a way to resolve the congressional concern.

“All options are on the table,” said Energy spokesman Drew Malcolm. “The secretary has reaffirmed that he is concerned. But we have not ever released oil from the Strategic Petroleum Reserve to deal with a price problem.”

Malcolm said the oil is meant to be retained for “a national supply disruption – like Kuwait,” when access to reserves was cut off during the Persian Gulf War.

In a letter to Clinton, more than 110 House members called on the administration to re-evaluate its energy policy.

“Unless averted, this winter’s expected crisis could have a disastrous impact on the American people – especially the elderly, working families, family farmers, small businesses, the disabled and the poor,” said the letter, crafted by Reps. Bernard Sanders, I-Vt., and Jack Quinn, R-N.Y. The letter was co-signed by Baldacci and most of the House members from New England.

The group wants the administration to effect a crude oil swap – previously proposed – that would take about 30 million barrels of crude and replenish the supply at a lower fixed price next spring.

The members also are urging the president to “demand that OPEC and other major foreign suppliers increase their production” of crude oil and home heating oil exports to the United States. However, most of the cartel is running at capacity, and those countries that are not face a production-equipment shortage.

The president also is being asked to release $400 million in emergency Low Income Home Energy Assistance Program (LIHEAP) funding.

Some members realize that politics comes into play, and Rep. Joe Moakley, D-Mass., said it could be useful for Vice President Al Gore to interject a supportive position into his presidential campaign. Added Rep. Michael E. Capuano, D-Mass.: “What is required is for both candidates for president to step up to the plate. We need presidential leadership.”

Today, the scene shifts to the Senate where Collins and Snowe will have a shot at probing administration policy at the informal meetings. The two senators joined their New England colleagues – including Sen. Joseph I. Lieberman, D-Conn., the Democratic vice presidential nominee – in asking Richardson to come and discuss his views.

“This is not just a matter of increased costs of home heating oil – although we are very concerned that this would have a severe impact on the low-income elderly in our state,” Snowe and Collins wrote to Richardson. “It’s also a matter of critical importance if home heating oil stocks continue to remain dangerously low.”

The sense of the matter is that there is blame to be shared, and the House members – while a bipartisan group – took some shots at the Senate for failing to push through legislation that would fund federal energy programs and expand LIHEAP.

The House members signed a separate letter to House and Senate appropriations leaders calling for funding LIHEAP at $1.5 billion – $550 million above the amount in both the existing House and Senate funding bills. The House members also are pressing for additional Weatherization Assistance Program money ($86 million more than the $140 million now pending); $16 million in additional funding for state energy programs and $50 million for incentives for residences and businesses to install clean, distributed power generation systems.

President Clinton already has taken one step, setting up a New England Heating Oil Reserve, which is expected to be filled with about 2 million barrels of oil at sites in New York and New Haven, Conn. So far, about a half-million barrels of oil have arrived at the Connecticut site, Energy officials said.

“Before families discover they can’t afford to heat their homes, before senior citizens have to choose between buying groceries and paying the utility bills, we need to act,” Moakley said.