Iran

Floor Speech

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Ms. MURKOWSKI. Madam President, like so many of us here in the Senate and really across the country, I think we have all been watching the news this weekend to see whether or not we would have an announcement from the Trump administration on a possible agreement to reopen the Strait of Hormuz and ensure that Iran never develops a nuclear weapon, among other objectives. I think the news this morning was promising, and we are all waiting to see what the contours of that agreement will be.

We can debate the way the administration started this war, but I certainly stand here today genuinely wishing the administration all the best in ending this on favorable terms. It would clearly be good for the region and it would be good for the world if the Iranian regime stops funding terror and permanently abandons its nuclear ambitious. I think we can all agree to that.

Yes, while there appears to be a final agreement, we haven't seen it yet. We want to have a good deal from the U.S. perspective. We are going to learn more this week. As we do that, I hope that things will begin to reopen and that we will be able to stave off what has been rapidly approaching in our energy markets, and that is what I want to speak to more directly today.

We know the basics here. All across the country, people and businesses are just paying a lot more for fuel. We have seen the prices go down a little bit today--that is good news--but the fact of the matter is, we have all felt the impact from rising prices.

The price of oil went up substantially during the war, and so did the price of gasoline, the price of diesel, of kerosene, of avgas, and other fuels as well. That is taking a toll. It is simply more expensive to drive, and it is more expensive to fly and to buy groceries. According to one estimate, the average American household has paid nearly $400 more for fuel since the start of the conflict.

As tough as that all is--and it has been. It has been very hard for many families. But it has also been somewhat tempered. For the past couple months, we have been emptying ships with fuel that had already transited the Strait of Hormuz. Some regional flows have been rerouted to bypasses. That has been good in terms of getting product out there. Some producers-- particularly here in the United States--have clearly stepped up their production, and we have seen how that has been able to soften things. China has reduced its imports, and refiners have adjusted their runs. So there has been a lot that has been going on in really trying to work to soften this impact. We have also tapped into commercial stocks and our emergency reserves through the Strategic Petroleum Reserve.

We have benefited from some sound policies that this country has put in place. It was not too many years ago that I was very proud to be able to lead the effort to lift the ban on crude oil exports, which, as we have seen, has greatly stabilized the markets here.

So far, we have avoided the energy crisis that many thought inevitable after so much global supply went offline, but I don't think we are out of the woods yet. Global oil inventories are now dangerously low, and many in the industry are sounding the alarm, and they are telling us things like: We are running out of runway here; that we have depleted our buffers and our shock absorbers; that inventories have declined to levels not seen for 40-plus years. And once no cushion is left, it is just really hard--it is hard to keep those prices down when you don't have the absorber here. I hope we are going to be able to avoid that, absolutely, because the consequences could be catastrophic in some places.

As a Senator from Alaska, I am keenly aware that even if most of the country is able to avoid the worst, there are some who won't be able to escape it. In fact, some are already living through it, and they are living in my home State right now in communities like Ambler and Galena and Mountain Village. What they are seeing is the impact of these rising prices that unfortunately are high now, but it is really hard for them to see relief in sight.

Even if the Strait of Hormuz fully opens this week, even if regional production and shipping come back much faster than projected, these Alaskans in these communities and around my State will continue to face the repercussions of this war and will for months to come. It is them that I want to draw attention to because, quite honestly, they need some help. They need and deserve help from every level of government-- starting in Alaska and primarily from the State of Alaska but extending to some reasonable actions we can take here.

Let me explain. How is the war in Iran impacting towns and villages more than 6,000 miles away in Alaska so much more so than in other places? Because I am hearing from all my colleagues that everyone is feeling the impact in their communities. So why am I standing here today to say that our situation is just a little bit harder, a little bit more challenging now, and why will those impacts continue even after the war is over?

So we can't have a discussion about Alaskan communities without putting it in context of the whole. Alaska is big. We all know Alaska is big--one-fifth the size of the United States of America. If you stretched Alaska over the lower 48 States, we would stretch from Florida all the way to these Aleutian Islands, all the way out to California, practically from the Canadian border going south. It is big, and in the midst of all this big geography, we have some 200 isolated communities around the State--20 percent of our total population--that are not connected by a road system.

So all these that you are seeing here, all around the outline and the perimeter of the State, all the way up to the North Slope--all that-- not connected by road, right? And down here in the section of the State where I grew up, this is all island, so nobody is connected by a road there. So you have the panhandle and the Aleutians and all of your coastline here that is not connected by road.

And so they are supplied by way of boats and planes to bring in the goods, to bring in food, the medical supplies, their mail, and their fuel, the fuel that they rely on. So many of these particularly small coastal communities, they are diesel-powered generation. So they rely on diesel to be able to keep their lights on. And sometimes they are offset by a little bit of wind, maybe a little bit of solar, but for the most part many of those communities are diesel-powered, so they rely on this as their fuel supply.

So how do you get your fuel? It is not like you can just call up the fuel barge any time of year--because once you get around here, you run into ice-choked waters all the way up to the top, rivers frozen over. And so in order to deliver the fuel, you have to wait until the ice has moved out, the ice has moved out of the area, melted.

And so this is the time of year. It is hotter than dickens here in Washington, DC, but back home the ice has really just left a matter of weeks ago to allow for these fuel barges to get up into this region to start resupplying these communities. So effectively what happens is, for most of these coastal communities and our river communities--the Kuskokwim coming up here and the Yukon coming up here is going all the way into Canada. For many of those communities, they get their fuel by the barges that come in here. They lighter on and take them up into smaller barges all the way up to rivers. So it may be July before they get the fuel, but it has really just started now, in June, where you see the first fuel delivered.

The second delivery is going to come typically in September before freezeup. And sometimes, in many of the river communities, it is just fuel delivery once a year because the water in the rivers may be low enough that you are not able to make it up all the way.

So it is expensive, right, if you have to haul all this. And I don't have my other map, but, you know, the State of Alaska is sitting right up here. We have to go through Canada. We have to go through the Gulf of Alaska, around through the Aleutians, to get all the way up. Transportation costs are high. So fuel was expensive even in these communities before the war.

So if you think $4 a gallon in Denver is bad, try $9 a gallon in Dillingham. Four dollars a gallon is bad in New Hampshire, but up here in Nuiqsut, it is about $14 a gallon. And these are prices that I had my interns check just last week. So these are the current prices. These are the current prices before we have had the spring barges coming in.

So think about what is happening in these communities. And in the hubs, like down here in Bethel or here in Nome or up in Kotzebue, the fuel barges--the spring barges--are arriving. And so the fuel prices that I just mentioned--$9 a gallon in Dillingham or $14 in Nuiqsut-- those prices are going to go up. We are looking at estimates of perhaps 50 percent or more. So this is sticker shock.

It is tough enough to see the increase with those spring barge prices coming on, but then, keep in mind, this is not just a blip. This is not just a temporary increase. These prices are going to last for months because that is the only way they can buy their fuel. They buy it in bulk. So these shipments have to last them either for the rest of the summer, through September; or, again, for some, it has to last them through the end of the year.

So what happens is they are locked into the fuel prices that they have paid in just the past month, 6 weeks, 2 months. They had to lock in at these high prices.

So the hubs are facing strains, but costs are going to be even higher for the communities that are upriver or inland from them. And not every situation is going to be the same, but you are probably going to have to add another couple of dollars per gallon for most of those folks that are inland. In the King Salmon area, right around down in here, you have got a small road that connects you to Naknek. I will be going there in a couple weeks. You can get groceries at the AC store, but it is a 15-mile drive each way and fuel is running about $9.11 per gallon. So you think about it; you don't just run off to the stores to go get some milk. It is not a cheap commute.

In Hooper Bay--here--where fuel costs almost $10 a gallon, residents are now paying $550 to fill up their fuel tanks. That is going to translate to more than $1,000 a month this winter. And, again, even if the oil prices continue to fall, as we have seen just from the news this weekend--again, that is good, but my fear is that these communities that we are seeing and I am talking about are not going to be able to benefit from it because, again, they had to buy when the prices were high, and they are locked in now. So time just didn't work in their favor.

It takes about 3 months from the time of refinery order to deliver in upriver villages. So they couldn't just sit back and say: Well, we are just going to wait and see how this all plays out and hope for lower prices--because, if they do that, they risk not getting any fuel at all as we get closer to winter, the sea ice returning, and you are locked out. Then the only solution is flying fuel in 50-gallon barrels at a time. That is expensive.

So it is hard right now. And we seek to avoid the worst of the worst, but for some communities this has just been a really hard time. These are small communities. Some don't have the working capital to pay 50 percent more for their fuel. Again, so some are actually waiting and risking bad outcomes this winter because, again, they just might not be in a position to be able to buy their fuel.

Rural Alaska has faced an affordability crisis for some time. So when it suddenly intensifies like this, I don't even know--I don't even know what we would call it. But I can tell you this much. If you live in one of these rural towns and villages, you are wondering: How am I going to make it? How am I going to make it? Because this is the time of year where you need to be able to put--you need to fuel up your skiff to go upriver to go fishing so you can feed your family--because what you can get in the store was expensive before and is now more expensive. You need to be able to go out hunting for caribou, and so you need to be able to fill up your four-wheeler.

But, again, these are challenges that we have faced. And it is not only about food security. You are trying to figure out where else can I cut back because we have got to have the fuel in order to make it through the winter. None of these places are easy places to live--and particularly in the winter.

I got a letter just today--in fact, just a couple of hours ago--from one of the leaders from the AVCP region, and she starts off by saying ``It is not too often that I am scared, but today I am.'' And she speaks to the challenge of higher fuel costs, the concerns that they have with regards to accessing salmon and just being able to provide for their families. And I talk a lot about the rural communities because their situation is just so challenged right now, but it is not just in rural Alaska that we are seeing the concerns. Every Alaskan is feeling it. In Fairbanks, in the interior, where I went to high school, the local utility has, just last month, announced a new fuel surcharge for customers. It is averaging almost $50--$45.74 a month. Again, that is an add-on to already high utility bills.

These are the issues that emerge when your home State's ability to responsibly produce its resources has been choked off for decades, resulting in a pipeline system that is one-quarter full, less instate refinery capacity that you would otherwise have, and less space in the budget to build out new energy systems.

So my final point today is these folks, these Alaskans, are going to need some help. As I said, most of that should come from the State of Alaska because, in fairness, our budget has benefited from the war. Our State's treasury has been helped because of the higher prices of oil. And I do commend our State legislature. They have already passed legislation to provide a $200 energy rebate to each Alaskan. They have doubled the cap on a bulk fuel revolving loan program. They appropriated more funding to it. They have made an allocation to school districts to purchase fuel. And they have brought back some community assistance programs. So I am pleased with some of the direction that they have taken. We are waiting for the Governor to sign those measures. But I think there is a possibility that our State legislature could do more in a future special session.

Here at the Federal level, I think we will have an opportunity to complement their actions, to help those hurt most dramatically, most immediately, by higher fuel costs. We can do things within some of the existing programs that we have. We can provide full funding and emergency contingency funding for the Low-Income Home Energy Assistance Program, LIHEAP. We can also appropriate funding for USDA's High Energy Cost Grants Program. The Denali Commission in Alaska administers this. We can look at a new mechanism to provide temporary assistance to those who are grappling with perhaps some of the heaviest of burdens.

And we can help, and I want to underscore that. So as this Chamber considers an Iran supplemental to replenish missiles, interceptors, radars, drones, and the infrastructure that we have lost, I would hope that some of these options might be on the table because, for some of our fellow Americans--especially those in rural Alaska--the impacts of this war won't end when a peace agreement is signed; it is going to continue long after, making life even more challenging.

So I share this with colleagues in an effort to explain some of what we face in a place that many feel is far away and very remote. But I would also suggest that we all have rural places in our States. We all have those communities that are challenged right now. So how we are there for them as they face these matters within their own families, to be there for them, is why we are here.

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