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. Last Updated: 07/27/2016

Bush Unveils Plan on Gasoline Prices

WASHINGTON -- With gasoline prices expected to hover at record highs through summer, U.S. President George W. Bush on Tuesday called for price-fixing investigations and several measures aimed at holding down the costs of driving.

Amid growing Republican unrest about the politics of gasoline at $3 per gallon, or 79 cents per liter, Bush told the Renewable Fuels Association he would take the unusual step of suspending shipments to the U.S. Strategic Petroleum Reserve to boost supply and help hold down oil prices. The president also said he would temporarily ease environmental regulations that require the use of cleaner-burning fuel additives to cut down on summertime pollution.

Still, according to industry experts and administration officials, Bush's efforts at best are likely to shave a few cents per gallon off the cost of gasoline.

"Energy experts predict gas prices are going to remain high throughout the summer, and that's going to be a continued strain on the American people," Bush said in his speech.

Under pressure from Republican leaders, Bush is taking a tough public line with the U.S. oil companies that are recording record profits and paying hefty salaries and retirement packages to executives. Bush ordered three federal agencies to investigate whether companies are manipulating the cost of gasoline -- boosting prices as many report record profits. The administration asked state governments to do the same.

Some lawmakers and consumer groups have charged that oil companies are improperly setting high prices -- an accusation that has been difficult to prove in the past.

Despite Tuesday's tough rhetoric, neither the White House nor Congress is rushing to hit the oil industry in the pocketbook.

Republicans negotiating a major tax bill have agreed to strike Senate-passed measures that would raise taxes on the major oil companies by nearly $5 billion over five years. And Bush's statement that Congress should roll back tax breaks for the industry is less dramatic than it sounds. His proposal merely stretches out a tax write-off from oil exploration from two years to five years, a plan that industry officials do not oppose.

Privately, Republicans said price-fixing investigations are good politics but unlikely to result in any significant punishments or price changes this year. Bob Slaughter, president of the National Petrochemical & Refiners Association, said that it "does smack of 'round up the usual suspects.'"

Bush is trying to walk a fine line with gasoline prices. Two years ago, when Democratic presidential candidate John Kerry suggested suspending purchases for the strategic petroleum reserve, Bush responded, "We will not play politics with the Strategic Petroleum Reserve," which he emphasized is solely for "major disruptions of energy supplies."

With polls showing that high gas prices are creating deep anxiety about the election-year economy, however, the president wants to project the image of a leader doing everything he can to provide some relief -- without alienating corporate allies and economic conservatives who loathe government intervention in the market.

The White House on Tuesday rejected one measure backed by Democrats and at least one prominent Republican: a tax on some oil company profits. White House spokesman Scott McClellan called it a "failed command-and-control approach of the past."

Bush's order to suspend oil shipments to the strategic oil reserve -- the government's emergency supply for national security or other crises -- will increase the domestic supply by less than 1 percent. This could translate into saving consumers a few cents per gallon at best, energy experts said. Philip Verleger, an Aspen, Colorado-based oil consultant, said that Bush's proposals were "more or less like prescribing aspirin to take care of prostate cancer."