I 
110TH CONGRESS 
1ST SESSION H. R. 1500 
To provide for the stabilization of prices for gasoline, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
MARCH 13, 2007 
Mr. DEFAZIO introduced the following bill; which was referred to the Com-
mittee on Energy and Commerce, and in addition to the Committees on 
Ways and Means, Oversight and Government Reform, Judiciary, Natural 
Resources, and Foreign Affairs, for a period to be subsequently deter-
mined by the Speaker, in each case for consideration of such provisions 
as fall within the jurisdiction of the committee concerned 
A BILL 
To provide for the stabilization of prices for gasoline, and 
for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Gasoline Price Stabilization Act of 2007’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title and table of contents. 
Sec. 2. Strategic petroleum reserve drawdown. 
Sec. 3. Minimum inventory levels. 
Sec. 4. Ban on exporting of Alaskan oil. 
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Sec. 5. Sense of Congress regarding the Organization of the Petroleum Export-
ing Countries and the World Trade Organization. 
Sec. 6. Windfall profits tax and credit for purchasing fuel-efficient American- 
made passenger vehicles. 
Sec. 7. Merger moratoriums. 
Sec. 8. Petroleum Industry Concentration and Market Power Review Commis-
sion. 
Sec. 9. Increased average fuel economy standards for passenger automobiles 
and light trucks. 
Sec. 10. Fuel economy of the Federal fleet of vehicles. 
SEC. 2. STRATEGIC PETROLEUM RESERVE DRAWDOWN. 
(a) DRAWDOWNS AUTHORIZED TO ADDRESS STATE 
OR REGIONAL ECONOMIC HARM.—Section 161(d)(2)(C) 
of the Energy Policy and Conservation Act (42 U.S.C. 
6241(d)(2)(C)) is amended by inserting ‘‘, or on a State 
or regional economy’’ after ‘‘national economy’’. 
(b) DRAWDOWNS AUTHORIZED TO COMBAT ANTI- 
COMPETITIVE CONDUCT.—Section 161(d) of the Energy 
Policy and Conservation Act (42 U.S.C. 6241(d)) is fur-
ther amended by adding at the end the following new para-
graph: 
‘‘(3)(A) For purposes of this section, in addition to 
the circumstances set forth in section 3(8) and in para-
graph (2) of this subsection, a severe energy supply inter-
ruption exists if the President determines that— 
‘‘(i) there is a significant reduction in supply 
that— 
‘‘(I) is of significant scope and duration; 
and 
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‘‘(II) has caused a significant increase in 
the price of petroleum products; 
‘‘(ii) the increase in price is likely to cause a 
significant adverse impact on the national economy, 
or on a State or regional economy; and 
‘‘(iii) the reduction in supply is substantially 
caused by conduct that lessens competition (or tends 
to create a monopoly) by— 
‘‘(I) at least one foreign country or inter-
national entity; or 
‘‘(II) at least one producer, refiner, or 
marketer of petroleum products. 
‘‘(B) Proceeds from the sale of petroleum drawn 
down pursuant to a Presidential determination under sub-
paragraph (A) shall— 
‘‘(i) be deposited in the SPR Petroleum Ac-
count established under section 167; and 
‘‘(ii) be used only for the purposes specified in 
such section.’’. 
(c) REPORTING
AND
CONSULTATION
REQUIRE-
MENTS.—When the price of a barrel of crude oil exceeds 
$50 (in constant 2005 United States dollars) on the New 
York Mercantile Exchange for a period greater than 14 
days, the President, through the Secretary of Energy, 
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shall, not later than 30 days after the end of the 14-day 
period, submit to Congress a report that— 
(1) states the results of a comprehensive review 
of the causes and potential consequences of the price 
increase; 
(2) provides an estimate of the likely duration 
of the price increase, based on analyses and fore-
casts of the Energy Information Administration; 
(3) provides an analysis of the effects of the 
price increase on the cost of gasoline at the whole-
sale and retail levels; and 
(4) states whether, and provides a specific ra-
tionale for why, the President does or does not sup-
port the drawdown and distribution of a specified 
amount of oil from the Strategic Petroleum Reserve. 
(d) GENERAL ACCOUNTING OFFICE STUDY.—The 
Comptroller General of the United States shall, not later 
than one year after the date of the enactment of this Act, 
submit to Congress a review of the drawdown authority 
of the President with respect to the Strategic Petroleum 
Reserve. Such review shall address— 
(1) how and why the authority has changed 
over time; 
(2) under what circumstances Presidents have 
actually exercised the authority; 
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(3) what the impact on oil prices was as a re-
sult of the exercising of the presidential authority; 
and 
(4) the implications of expanding the drawdown 
authority beyond the severe energy supply interrup-
tion standard described in section 3(8) or 161(d) of 
the Energy Policy and Conservation Act (42 U.S.C. 
6202(8), 6241(d)), by— 
(A) allowing the release of oil as a regular 
hedging tool for oil companies; 
(B) allowing such companies to tap the 
Strategic Petroleum Reserve as necessary to 
dampen price shocks; and 
(C) requiring such companies to replace 
the oil (and additional barrels) at some pre-
determined time in the future. 
SEC. 3. MINIMUM INVENTORY LEVELS. 
(a) ESTABLISHING MINIMUM LEVELS.—The Sec-
retary of Energy shall establish minimum inventory levels 
that producers, refiners, and marketers of crude oil and 
petroleum products must maintain in order to limit the 
impact unexpected supply disruptions have on prices at 
the wholesale and retail levels. 
(b) REGIONAL VARIATIONS.—For purposes of sub-
section (a), the minimum inventory levels shall take into 
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account regional variations in supply and demand, and 
market structure. 
(c) ADMINISTRATIVE PROCEDURES.—For purposes 
of subsection (a), the Secretary may perform the following 
procedures: 
(1) DIFFERENT
INDUSTRY
SEGMENTS.—Set 
varying levels for each segment of the oil industry as 
the Secretary determines appropriate. 
(2) DIFFERENT PRODUCTS.—Set different lev-
els for the various crude oil and petroleum products, 
including gasoline, home heating oil, and jet fuel. 
(3) SEASONAL ADJUSTMENT.—Adjust minimum 
inventory levels to reflect seasonal adjustments. 
SEC. 4. BAN ON EXPORTING OF ALASKAN OIL. 
(a) REPEAL
OF
PROVISION
AUTHORIZING
EX-
PORTS.—Section 28(s) of the Mineral Leasing Act (30 
U.S.C. 185(s)) is repealed. 
(b) REIMPOSITION OF PROHIBITION ON CRUDE OIL 
EXPORTS.—Section 7(d) of the Export Administration 
Act of 1979 (50 U.S.C. App. 2406(d)) shall be effective 
as of the date of the enactment of this Act, and those 
provisions of the Export Administration Act of 1979 (in-
cluding sections 11 and 12) shall apply to the extent nec-
essary to carry out such section 7(d), notwithstanding sec-
tion 20 of such Act and notwithstanding any other provi-
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sion of law that would otherwise allow the export of oil 
to which such section 7(d) applies. 
SEC. 5. SENSE OF CONGRESS REGARDING THE ORGANIZA-
TION OF THE PETROLEUM EXPORTING COUN-
TRIES AND THE WORLD TRADE ORGANIZA-
TION. 
(a) FINDINGS.—Congress makes the following find-
ings: 
(1) No free market exists in oil production be-
cause of collusion among large oil-producing coun-
tries. 
(2) The Organization of the Petroleum Export-
ing Countries (in this section referred to as 
‘‘OPEC’’) and other oil-producing countries have re-
peatedly agreed to coordinated cutbacks in produc-
tion, thus manipulating world oil markets, resulting 
in de facto price fixing. 
(3) Such manipulation led to the highest price 
per barrel of oil in nearly a decade, substantial in-
creases in consumer prices for items such as home 
heating oil and gasoline, and continued price vola-
tility. 
(4) Rising oil prices greatly harm consumers, 
farmers, small businesses, and manufacturers, in-
crease the likelihood of inflation, increase the cost of 
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conducting interstate and international commerce, 
and pose a strong threat to continued economic 
growth. 
(5) Article XI of the General Agreement on 
Tariffs and Trade of 1994 (in this section referred 
to as ‘‘GATT’’) prohibits members of the World 
Trade Organization (in this section referred to as 
‘‘WTO’’) from setting quantitative restrictions on 
the import or export of resources or products across 
their borders; specifically the language reads: ‘‘No 
prohibitions or restrictions other than duties, taxes 
or other charges, whether made effective through 
quotas, import or export licenses or other measures, 
shall be instituted or maintained by any contracting 
party on the importation of any product of the terri-
tory of any other contracting party or on the expor-
tation or sale for export of any product destined for 
the territory of any other contracting party.’’. 
(6) The precise meaning of such article XI was 
spelled out in a GATT Panel Report issued in 1988 
entitled ‘‘Japan—Trade in Semi-conductors’’, which 
notes, ‘‘. . . this wording [in article XI] was com-
prehensive: it applied to all measures instituted or 
maintained by a contracting party prohibiting or re-
stricting the importation, exportation, or sale for ex-
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port of products other than measures that take the 
form of duties, taxes, or other charges. . . . This 
wording indicated clearly that any measure insti-
tuted or maintained by a contracting party which re-
stricted the exportation or sale for export of prod-
ucts was covered by this provision, irrespective of 
the legal status of the measure.’’. 
(7) Oil production restrictions clearly qualify as 
a ‘‘quantitative restriction’’ based on the original 
WTO rules and the 1988 GATT panel report, which 
certify that only ‘‘duties, taxes, or other charges’’ 
are allowable, not pacts among countries to limit 
production of a product for export. 
(8) Article XX of GATT, which sets out a se-
ries of exceptions to article XI, notes that none of 
the exceptions is valid if it is ‘‘applied in a manner 
which would constitute . . . a disguised restriction on 
international trade’’, a phrase which describes pro-
duction restrictions of OPEC. 
(9) Of the 12 OPEC countries, eight are mem-
bers of the WTO (Angola, Kuwait, Indonesia, Nige-
ria, Qatar, Venezuela, Saudi Arabia, and United 
Arab Emirates), and four have observer status and 
have applied to join the WTO (Algeria, Libya, Iran, 
Iraq). 
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(10) In addition, of the remaining large oil-pro-
ducing nations, Mexico, Norway, and Oman are 
members of the WTO, and Russia has applied for 
membership. 
(11) Given the substantial WTO membership 
and pending membership of oil-producing countries, 
filing a complaint would likely have an immediate 
impact on the current and future behavior of these 
countries. 
(b) FILING OF COMPLAINT.—The President shall in-
struct the United States Trade Representative to file a 
complaint in the World Trade Organization against oil- 
producing countries for violating their obligations under 
the rules of that organization. 
SEC. 6. WINDFALL PROFITS TAX AND CREDIT FOR PUR-
CHASING FUEL-EFFICIENT AMERICAN-MADE 
PASSENGER VEHICLES. 
(a) WINDFALL PROFITS TAX.— 
(1) IN GENERAL.—Subtitle E of the Internal 
Revenue Code of 1986 (relating to alcohol, tobacco, 
and certain other excise taxes) is amended by adding 
at the end thereof the following new chapter: 
‘‘CHAPTER 56—WINDFALL PROFITS ON 
CRUDE OIL 
‘‘Sec. 5896. Imposition of tax. 
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‘‘Sec. 5897. Windfall profit; removal price; adjusted base price; qualified invest-
ment. 
‘‘Sec. 5898. Special rules and definitions. 
‘‘SEC. 5896. IMPOSITION OF TAX. 
‘‘(a) IN GENERAL.—In addition to any other tax im-
posed under this title, there is hereby imposed on any inte-
grated oil company (as defined in section 291(b)(4)) an 
excise tax equal to the excess of— 
‘‘(1) the amount equal to 50 percent of the 
windfall profit from all barrels of taxable crude oil 
removed from the property during each taxable year, 
over 
‘‘(2) the amount of qualified investment by such 
company during such taxable year. 
‘‘(b) FRACTIONAL PART OF BARREL.—In the case of 
a fraction of a barrel, the tax imposed by subsection (a) 
shall be the same fraction of the amount of such tax im-
posed on the whole barrel. 
‘‘(c) TAX PAID BY PRODUCER.—The tax imposed by 
this section shall be paid by the producer of the taxable 
crude oil. 
‘‘SEC. 5897. WINDFALL PROFIT; REMOVAL PRICE; AD-
JUSTED BASE PRICE; QUALIFIED INVEST-
MENT. 
‘‘(a) GENERAL RULE.—For purposes of this chapter, 
the term ‘windfall profit’ means the excess of the removal 
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price of the barrel of taxable crude oil over the adjusted 
base price of such barrel. 
‘‘(b) REMOVAL PRICE.—For purposes of this chap-
ter— 
‘‘(1) IN GENERAL.—Except as otherwise pro-
vided in this subsection, the term ‘removal price’ 
means the amount for which the barrel of taxable 
crude oil is sold. 
‘‘(2) SALES BETWEEN RELATED PERSONS.—In 
the case of a sale between related persons, the re-
moval price shall not be less than the constructive 
sales price for purposes of determining gross income 
from the property under section 613. 
‘‘(3) OIL REMOVED FROM PROPERTY BEFORE 
SALE.—If crude oil is removed from the property be-
fore it is sold, the removal price shall be the con-
structive sales price for purposes of determining 
gross income from the property under section 613. 
‘‘(4) REFINING BEGUN ON PROPERTY.—If the 
manufacture or conversion of crude oil into refined 
products begins before such oil is removed from the 
property— 
‘‘(A) such oil shall be treated as removed 
on the day such manufacture or conversion be-
gins, and 
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‘‘(B) the removal price shall be the con-
structive sales price for purposes of determining 
gross income from the property under section 
613. 
‘‘(5) PROPERTY.—The term ‘property’ has the 
meaning given such term by section 614. 
‘‘(c) ADJUSTED BASE PRICE DEFINED.— 
‘‘(1) IN GENERAL.—For purposes of this chap-
ter, the term ‘adjusted base price’ means $50 for 
each barrel of taxable crude oil plus an amount 
equal to— 
‘‘(A) such base price, multiplied by 
‘‘(B) the inflation adjustment for the cal-
endar year in which the taxable crude oil is re-
moved from the property. 
The amount determined under the preceding sen-
tence shall be rounded to the nearest cent. 
‘‘(2) INFLATION ADJUSTMENT.— 
‘‘(A) IN GENERAL.—For purposes of para-
graph (1), the inflation adjustment for any cal-
endar year after 2008 is the percentage by 
which— 
‘‘(i) the implicit price deflator for the 
gross national product for the preceding 
calendar year, exceeds 
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‘‘(ii) such deflator for the calendar 
year ending December 31, 2007. 
‘‘(B) FIRST REVISION OF PRICE DEFLATOR 
USED.—For purposes of subparagraph (A), the 
first revision of the price deflator shall be used. 
‘‘(d) QUALIFIED INVESTMENT.—For purposes of this 
chapter— 
‘‘(1) IN GENERAL.—The term ‘qualified invest-
ment’ means any amount paid or incurred with re-
spect to— 
‘‘(A) section 263(c) costs, 
‘‘(B) qualified refinery property (as defined 
in section 179C(c) and determined without re-
gard to any termination date), 
‘‘(C) any qualified facility described in 
paragraph (1), (2), (3), or (4) of section 45(d) 
(determined without regard to any placed in 
service date), 
‘‘(D) any facility for the production of al-
cohol used as a fuel (within the meaning of sec-
tion 40) or biodiesel or agri-biodiesel used as a 
fuel (within the meaning of section 40A). 
‘‘(2) SECTION 263(c) COSTS.—For purposes of 
this subsection, the term ‘section 263(c) costs’ 
means intangible drilling and development costs in-
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curred by the taxpayer which (by reason of an elec-
tion under section 263(c)) may be deducted as ex-
penses for purposes of this title (other than this 
paragraph). Such term shall not include costs in-
curred in drilling a nonproductive well. 
‘‘SEC. 5898. SPECIAL RULES AND DEFINITIONS. 
‘‘(a) WITHHOLDING AND DEPOSIT OF TAX.—The 
Secretary shall provide such rules as are necessary for the 
withholding and deposit of the tax imposed under section 
5896 on any taxable crude oil. 
‘‘(b) RECORDS AND INFORMATION.—Each taxpayer 
liable for tax under section 5896 shall keep such records, 
make such returns, and furnish such information (to the 
Secretary and to other persons having an interest in the 
taxable crude oil) with respect to such oil as the Secretary 
may by regulations prescribe. 
‘‘(c) RETURN OF WINDFALL PROFIT TAX.—The Sec-
retary shall provide for the filing and the time of such 
filing of the return of the tax imposed under section 5896. 
‘‘(d) DEFINITIONS.—For purposes of this chapter— 
‘‘(1) PRODUCER.—The term ‘producer’ means 
the holder of the economic interest with respect to 
the crude oil. 
‘‘(2) CRUDE OIL.— 
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‘‘(A) IN GENERAL.—The term ‘crude oil’ 
includes crude oil condensates and natural gas-
oline. 
‘‘(B) EXCLUSION OF NEWLY DISCOVERED 
OIL.—Such term shall not include any oil pro-
duced from a well drilled after the date of the 
enactment of the Gasoline Price Stabilization 
Act of 2007, except with respect to any oil pro-
duced from a well drilled after such date on any 
proven oil or gas property (within the meaning 
of section 613A(c)(6)(A)). 
‘‘(3) BARREL.—The term ‘barrel’ means 42 
United States gallons. 
‘‘(e) ADJUSTMENT OF REMOVAL PRICE.—In deter-
mining the removal price of oil from a property in the case 
of any transaction, the Secretary may adjust the removal 
price to reflect clearly the fair market value of oil removed. 
‘‘(f) REGULATIONS.—The Secretary shall prescribe 
such regulations as may be necessary or appropriate to 
carry out the purposes of this chapter. 
‘‘(g) TERMINATION.—This section shall not apply to 
taxable crude oil removed after the date which is 3 years 
after the date of the enactment of this section.’’. 
(2) CLERICAL
AMENDMENT.—The table of 
chapters for subtitle E of the Internal Revenue Code 
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of 1986 is amended by adding at the end the fol-
lowing new item: 
‘‘CHAPTER 56. WINDFALL PROFIT ON CRUDE OIL.’’. 
(3) DEDUCTIBILITY
OF
WINDFALL
PROFIT 
TAX.—The first sentence of section 164(a) of the In-
ternal Revenue Code of 1986 (relating to deduction 
for taxes) is amended by inserting after paragraph 
(5) the following new paragraph: 
‘‘(6) The windfall profit tax imposed by section 
5896.’’. 
(4) EFFECTIVE DATE.— 
(A) IN GENERAL.—The amendments made 
by this section shall apply to crude oil removed 
after the date of the enactment of this Act, in 
taxable years ending after such date. 
(B) TRANSITIONAL RULES.—For the pe-
riod ending December 31, 2007, the Secretary 
of the Treasury or the Secretary’s delegate 
shall prescribe rules relating to the administra-
tion of chapter 56 of the Internal Revenue Code 
of 1986. To the extent provided in such rules, 
such rules shall supplement or supplant for 
such period the administrative provisions con-
tained in chapter 56 of such Code (or in so 
much of subtitle F of such Code as relates to 
such chapter 56). 
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(b) CREDIT
FOR
PURCHASING
FUEL-EFFICIENT 
AMERICAN-MADE PASSENGER VEHICLES.— 
(1) IN GENERAL.—Subpart A of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code 
of 1986 (relating to nonrefundable personal credits) 
is amended by inserting after section 25D the fol-
lowing new section: 
‘‘SEC. 25E. PURCHASE OF FUEL-EFFICIENT AMERICAN- 
MADE PASSENGER VEHICLES. 
‘‘(a) IN GENERAL.—In the case of an individual, 
there shall be allowed as a credit against the tax imposed 
by this chapter for the taxable year an amount equal to 
the cost of any qualified passenger vehicle purchased by 
the taxpayer during the taxable year. 
‘‘(b) MAXIMUM CREDIT.—The credit allowed by this 
section for the taxable year shall not exceed— 
‘‘(1) $3,000 in the case of a qualified passenger 
vehicle not described in paragraph (2) or (3), 
‘‘(2) $4,500 in the case of a qualified passenger 
vehicle the fuel economy of which is— 
‘‘(A) in the case of a truck or sport utility 
vehicle, at least 45 miles per gallon but less 
than 55 miles per gallon, and 
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‘‘(B) in any other case, at least 55 miles 
per gallon but less than 65 miles per gallon, 
and 
‘‘(3) $6,000 in the case of a qualified passenger 
vehicle the fuel economy of which is— 
‘‘(A) in the case of a truck or sport utility 
vehicle, at least 55 miles per gallon, and 
‘‘(B) in any other case, at least 65 miles 
per gallon. 
‘‘(c) QUALIFIED PASSENGER VEHICLE.—For pur-
poses of this section— 
‘‘(1) IN
GENERAL.—The term ‘qualified pas-
senger vehicle’ means any automobile (as defined in 
section 4064(b)(1))— 
‘‘(A) which is purchased after the date of 
the enactment of this section, 
‘‘(B) which is assembled in the United 
States by individuals employed under a collec-
tive bargaining agreement, 
‘‘(C) the original use of which begins with 
the taxpayer, 
‘‘(D) substantially all of the use of which 
is for personal, nonbusiness purposes, and 
‘‘(E) the fuel economy of such automobile 
is— 
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‘‘(i) at least 35 miles per gallon in the 
case of a truck or sport utility vehicle, and 
‘‘(ii) at least 45 miles per gallon in 
any other case. 
‘‘(2) FUEL ECONOMY.—Fuel economy shall be 
determined in accordance with section 4064. 
‘‘(d) SPECIAL RULES.— 
‘‘(1) BASIS
REDUCTION.—The basis of any 
property for which a credit is allowable under sub-
section (a) shall be reduced by the amount of such 
credit. 
‘‘(2) PROPERTY USED OUTSIDE UNITED STATES 
NOT QUALIFIED.—No credit shall be allowed under 
subsection (a) with respect to any property referred 
to in section 50(b)(1).’’. 
(2) CLERICAL AMENDMENT.—The table of sec-
tions for such subpart A is amended by inserting 
after the item relating to section 25D the following 
new item: 
‘‘Sec. 25E. Purchase of fuel-efficient American-made passenger vehicles.’’. 
(3) EFFECTIVE DATE.—The amendments made 
by this section shall apply to taxable years ending 
after the date of the enactment of this Act. 
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