WASHINGTON, DC – Tonight the U.S. Senate voted to advance a measure that would end tax subsidies for large oil companies.  U.S. Senator Jack Reed (D-RI), a cosponsor of the Repeal Big Oil Tax Subsidies Act, wants to end corporate welfare to the five largest oil companies and use the $20 billion in savings to reduce the U.S. deficit and develop clean energy programs in the United States. 

“We need to fuel the U.S. economy, not the oil cartels and big oil companies.  While Rhode Islanders are paying on average $3.88 per gallon at the pump, taxpayers are also providing billions in subsidies to big oil companies each year,” said Reed.  “It simply isn’t fair for taxpayers to be effectively charged twice for the same gallon of gas by continuing these wasteful handouts to big oil.  These wasteful subsidies for big oil companies are unnecessary and unjustifiable.” 

The big five oil companies—BP, Chevron, ConocoPhillips, ExxonMobil, and Shell—combined to make a record-high $137 billion in profits in 2011—up 75 percent from 2010—and have made more than $1 trillion in profits from 2001 through 2011.

“At a time when oil and gas companies are making record profits, they should not be guzzling down billions of dollars in taxpayer subsidies,” continued Reed.  “The American people are being forced to cut back because of high gas prices and the big oil companies should have their wasteful tax subsidies cut off.  That’s only fair and appropriate during tough times.”

Reed has sought to prevent excessive oil speculation from manipulating the market and needlessly driving up energy prices.  Reed has also worked on the Appropriations Committee to robustly fund the Commodity Futures Trading Commission (CFTC), effectively our cop on the beat for curbing excessive market speculation that is contributing to higher oil and gasoline prices.

Reed has also championed increased fuel efficiency to help wean America off oil.  Working with President Obama, Senator Reed successfully persuaded automakers to double the fuel efficiency of cars and light trucks.  After efficiency standards stayed the same for over 20 years, Senator Reed successfully worked with the Obama Administration to issue new rules in 2010 requiring that new cars and light trucks average 35.5 mpg in 2016.  And the Administration has proposed standards further increase to 54.5 mpg in 2025.  Combined they will save 12 billion barrels of oil, saving consumers an estimated $8,200 over the lifetime of the vehicle.

“Lowering gas prices and reducing our dependence on foreign oil requires a smart, balanced, and responsible national energy policy.  Tonight’s vote is a fiscally responsible step toward standing up for middle-class families, paying down the debt, ending corporate welfare for big oil, and supporting clean energy technologies,” concluded Reed, the Chairman of the Appropriations Subcommittee on the Interior and Environment, who supports stronger oversight to ensure energy companies drilling in public lands and waters are paying the appropriate level of royalties to the American people.