Bush brings in measures to tackle oil price crisis

US: President Bush has sought to ease public disquiet over rising fuel prices with a package of measures that include halting…

US: President Bush has sought to ease public disquiet over rising fuel prices with a package of measures that include halting deposits into the United States emergency oil reserves to make more oil available to consumers.

Mr Bush has also relaxed environmental rules to speed up the supply of fuel to consumers and ordered an investigation into claims that oil companies have kept prices artificially high.

Describing recent price rises as a "hidden tax on working people", Mr Bush urged oil companies to re-invest their record profits into expanding refining capacity and researching alternative energy sources. He also asked Congress to scrap $2 billion in tax breaks for energy companies over the next 10 years.

"Cash flows are up. Taxpayers don't need to be paying for certain of these expenses on behalf of the energy companies," he told the Renewable Fuels Association in Washington.

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The president acknowledged that suspending deposits to the Strategic Petroleum Reserve would have only a small effect on the market.

"Our strategic reserve is sufficiently large enough to guard against any major supply disruption over the next few months.

"So by deferring deposits until the fall, we'll leave a little more oil on the market. Every little bit helps," he said.

Easing the environment rules will mean that refiners will not have to use certain additives such as ethanol to meet clean air standards.

For the long term, Mr Bush said America must invest in alternative energy sources, while also developing new supplies of fossil fuels in the US, including drilling in Alaska's Arctic National Wildlife Refuge (ANWR).

"I fully recognise that production in ANWR will not increase the fuel supply immediately. But if ANWR had been available a decade ago, America would be producing an additional million barrels of oil per day," he said.

Concern over high fuel prices has reached a frenzy in Capitol Hill, where Republicans fear that angry voters will blame them in November's congressional elections.