Lawmaker Blasts Oil Companies For Price Gouging

By Jim Burns | July 7, 2008 | 8:25 PM EDT

( - With the House returning to work on Capitol Hill this week, one Ohio lawmaker said he will introduce legislation to impose federal penalties of up to $100 million on domestic oil companies that "unreasonably raise prices on gasoline, diesel fuel and home heating oil."

Rep. James Traficant (D-OH) thinks that some domestic oil companies are unfairly raising prices in the wake of recent OPEC price increases.

"Some domestic oil companies are taking advantage of the recent increase in the price of foreign oil by unfairly raising their prices. This is wrong and counter to the economic interests of our country. Congress has an obligation to stop this outlaw behavior," Traficant said on Capitol Hill Friday.

Traficant's proposed bill would direct the Energy Information Administration (EIA), a division of the US Department of Energy to analyze the price of gasoline, diesel fuel and home heating oil to determine whether or not domestic oil companies are unreasonably raising prices.

The bill would also, according to Traficant, define an unreasonable price increase as a "price increase that goes beyond any concurrent increase in an oil company's production and operating costs."

If the EIA finds that a domestic oil company has unreasonably raised prices, according to Traficant's bill, it would have to pass this information onto the US Justice Department for possible prosecution. The Attorney General would decide which cases to prosecute, and the Commercial Litgation Division of the Justice Department would handle all cases.

If a company is found guilty of price gouging, Traficant's bill calls for fines of up to $100 million.

Traficant hopes to have his bill introduced in the House before this week is out.