No evidence of pump price profiteering: Bodman - Yahoo! News

WASHINGTON (Reuters) - The Bush administration sees no direct evidence of profiteering by big U.S. oil companies and is doing all it can to tame near-record prices, Energy Secretary Sam Bodman said on Sunday.

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With average gasoline pump prices near $3 a gallon and politicians clamoring to rein in record oil industry profits, President George W. Bush is trying to stave off a potential election-year problem for Republicans eager to hang on to control of Congress.

Asked on NBC's "Meet the Press" if oil companies are exploiting consumers, Bodman said "we see no evidence of it, but this is one of those situations where I guess I would call it 'trust but verify."'

Bodman pointed to an ongoing probe by the Justice Department and Federal Trade Commission into gasoline prices.

Bush last week unveiled a string of actions to tame energy prices, including suspending filling the U.S. emergency crude oil stockpile and taking a closer look at environmental rules that have limited gasoline supplies.

"This administration is doing everything it can do" Bodman said.

Senate Republicans last week unveiled their proposal to soften the gasoline price blow by giving taxpayers a $100 check and suspending an 18.4 cent-per-gallon federal tax.

Some Democrats and at least one Republican, Pennsylvania Sen. Arlen Specter (news, bio, voting record), have said the government should tax "windfall" industry profits.

Exxon Mobil Corp. in January reported U.S.-record profits of $36 billion over the past year. Many Americans were stunned by the size of the $400 million retirement package for former Exxon chief Lee Raymond. The company also last week reported an $8.4 billion profit for the first three months of 2006, its biggest first-quarter profit ever.

"If you do not tax these corporations ... they will continue to run up the profits to sky heavens," said Sen. Richard Durbin (news, bio, voting record), the No. 2 Senate Democrat.

Bodman reiterated that such a tax is a bad idea because it could spur the industry to produce less oil to avoid paying, which happened when such taxes were last enacted in the 1970s.

"That was tried 30 years ago -- it did not work," Bodman said. "That proposal does not hold water."

Separately, the head of the Environmental Protection Agency said on Friday he will head a task force of state governors to simplify "boutique fuel" rules that can exacerbate fuel shortages , and will soon cap the number of blends to comply with energy legislation signed last year.