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Gas prices could fall by 50 cents this summer; Democrats try to end Big Oil's tax breaks

May 9, 2011 | 11:18 am

Gas prices in San Francisco

Gas prices are not just the bane of consumers, who feel the pain at the pump, but also of politicians, who may get punched out at the polls if they are seen as being part of the problem.

Donald Trump, once he saw that banging the birther drum could only last so long, brazenly promised that if he were president and the United States was involved in foreign wars with oil-rich countries, he would "take" their oil after the conflict ended and the U.S. had won.

The Republican billionaire feels so strongly about this that if you disagree with him, even if you regularly appear on the GOP-friendly "O'Reilly Factor," Trump will call you a sad fool.

Although such made-for-TV bickering may be entertaining, Fred Rozell, the retail-pricing director at the Oil Price Information Service predicts that gas prices, which that typically balloon in the spring and fall in the summer, will drop by approximately 50 cents in the coming months.

Gas station owners, Rozell told the Associated Press, were caught on the wrong end of the dipstick recently as wholesale oil prices rose faster than they could adjust their retail prices. That trend will reverse this summer, Rozell predicted.

"So station owners will be watching each other this summer," Rozell said. "When one guy drops, so will the other."

A 50-cent drop in gas prices is estimated to save U.S. motorists about $189 million a day.

Meanwhile, Senate Democrats this week will attempt to push through legislation that would end $21 billion in tax breaks being given to five oil companies (BP, Exxon Mobil, Shell, Chevron and Conoco Phillips) and redirect those funds to green energy alternatives.

On Thursday, the Senate Finance Committee will hold a hearing during which Chairman Max Baucus (D-Mont.) is expected to ask executives of major oil companies why American taxpayers need to add to the coffers of those companies, which have known little else but record profits over the years.

"Big Oil certainly doesn't need the collective money of taxpayers in this country," said Sen. Robert Menendez (D-N.J.) told the New York Times. "This is as good a time as any in terms of pain at the pump and in revenues needed for deficit reduction."

A few weeks ago House Speaker John A. Boehner (R-Ohio) seemed to agree that this is probably not the right time for the U.S. to be handing billions of dollars over to Big Oil.

"We're in a time when the federal government's short on revenues," Boehner told ABC News late last month. "They ought to be paying their fair share. Everybody wants to go after the oil companies and frankly, they've got some part of this to blame."


In rural Alaska, $8.60 for a gallon of gasoline

Gas prices could reach $4.25 nationally by Memorial Day

President Obama asks Congress to eliminate tax breaks for the oil industry

-- Tony Pierce

Photo: A Union 76 station in San Francisco. Credit: Getty Images