Legislators want windfall tax for oil companies

WASHINGTON -- The government should consider a tax on oil companies if they make excessive profits amid rising gasoline prices, a leading Republican senator and several Democratic lawmakers said yesterday.

Senator Arlen Specter of Pennsylvania, chairman of the Senate Judiciary Committee, said a windfall profits tax, along with measures to stem concentration of market power among a few select oil companies, could offer eventual relief to consumers at the gas pump.

''I believe that we have allowed too many companies to get together to reduce competition," Specter said.

''They get together, reduce the supply of oil, and that drives up prices," he said. ''In the short run, it's hard to deal with it for tomorrow. But I think windfall profits, eliminating the antitrust exemption, considering the excessive concentration of power are all items we ought to be addressing."

Specter is backing legislation that would strengthen antitrust laws on oil company mergers after his committee held a hearing last month examining the growing consolidation of the oil industry.

The nation's largest oil companies, including Exxon Mobil Corp., have denied their industry size has affected prices. The companies are scheduled to report quarterly profits this week.

Last week, crude oil prices hit record highs and average gasoline prices nationwide neared $3 a gallon.

Senator Carl Levin, Democrat of Michigan, said he believes gas prices ''would come down within a matter of days" if President Bush told oil companies he was going to support a windfall profits tax.

''But the president will not call the oil companies into his office because he's been too closely allied with those oil companies, and if he does it's going to be a window-dressing conversation," said Levin, who appeared with Specter on CNN's ''Late Edition."

Senator Edward M. Kennedy, Democrat of Massachusetts, said on NBC's ''Meet the Press" yesterday that he also favored imposing a windfall profits tax and returning the money to working families.

''This is not a time for greed, and that is what we have on this. And the administration . . . has failed to take action," he said.

In California over the weekend, Bush offered little hope of short-term price relief, but he called on Congress to pass his energy plan, which aims to boost federal research into batteries for hybrid and electric cars and renewable fuels.

''I understand the folks here, as well as in other parts of the country are paying high gas prices," Bush said in Sacramento. ''We're going to have a tough summer."

Bush spoke after touring the workshop of the California Fuel Cell Partnership, which promotes hydrogen fuel-cell technology for electric cars and trucks

In the Democrats' weekly radio address Saturday, Senator Bill Nelson of Florida warned of ''economic havoc" if a terrorist attack sinks a super-tanker or a hurricane shuts down oil refineries in the Gulf Coast. ''Whatever the cause, the crisis is coming," he said.

Nelson said the administration must stop being influenced by the powerful oil industry and start promoting production of synthetic fuel from coal, broader use of alternative sources such as ethanol, and a significant increase in the mileage standards for all passenger vehicles.

Representative Rahm Emanuel, Democrat of Illinois, chairman of House Democrats' campaign arm, criticized Bush and Congress GOP leadership for subsidies and tax breaks for oil companies. ''The Republican Congress can't stop taking oil money and can't stop sending billion-dollar giveaways to their friends in the oil industry," he said.

Crude oil prices climbed above $75 a barrel Friday.