[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.J. Res. 87 Introduced in House (IH)]
110th CONGRESS
2d Session
H. J. RES. 87
Limiting the issuance of a letter of offer with respect to a certain
proposed sale of defense articles and defense services to the Kingdom
of Saudi Arabia.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
May 21, 2008
Mr. Weiner introduced the following joint resolution; which was
referred to the Committee on Foreign Affairs
_______________________________________________________________________
JOINT RESOLUTION
Limiting the issuance of a letter of offer with respect to a certain
proposed sale of defense articles and defense services to the Kingdom
of Saudi Arabia.
Whereas record-high gasoline prices are placing considerable fiscal strain on
American households that are already burdened by a weakening United
States economy;
Whereas the increase in gasoline prices is principally due to the increasing
price of crude oil, which has reached a price of more than $120 per
barrel in recent weeks, the highest price on record in inflation-
adjusted terms;
Whereas, because United States gasoline refiners must purchase crude oil on the
world market, the price they pay is highly sensitive to crude oil
production decisions made by entities with significant shares in the
market;
Whereas since 1973, the Organization of the Petroleum Exporting Countries (OPEC)
has cartelized the crude oil market, effectively controlling the supply
and price of petroleum products;
Whereas the Kingdom of Saudi Arabia, through the nationalized oil company Saudi
Aramco, controls 98 percent of the more than 260,000,000,000 barrels of
crude oil reserves in Saudi Arabia, and daily production of crude oil in
Saudi Arabia constitutes more than 10 percent of the world daily
production of crude oil;
Whereas, as the dominant member of Organization of the Petroleum Exporting
Countries, the Kingdom of Saudi Arabia has historically exercised
considerable market power by producing between 1,000,000 and 5,000,000
barrels of crude oil per day below its maximum daily capacity;
Whereas in April 2008, crude oil production by the Kingdom of Saudi Arabia was
nearly 2,000,000 barrels per day below its maximum daily capacity;
Whereas crude oil production by the Kingdom of Saudi Arabia in 2007 was
approximately 800,000 barrels per day less than in 2005;
Whereas energy economic analysis has determined that, holding world demand
constant, an increase by one percent of the crude oil supply of the
world results in a reduction by between 20 percent and 25 percent in
world crude oil prices in the near term;
Whereas, according to this analysis, an increase in crude oil production by the
Kingdom of Saudi Arabia by 1,000,000 barrels per day, which would result
in an increase in world crude oil supply of more than one percent,
could--
(1) reduce world oil prices by between percent 20 and 25 percent, and
result in a reduction in the price of a barrel of crude oil by more than
$25 per barrel from the current price of $126 per barrel; and
(2) in turn, reduce the price of gasoline by between 13 percent and 17
percent, or by more than 62 cents off the expected summer regular-grade
price of $3.66 per gallon;
Whereas, despite the refusal of the Kingdom of Saudi Arabia to increase its oil
production, the Administration continues to reward Saudi Arabia with
lucrative arms deals;
Whereas, since October 2007, the Administration has offered to sell the Kingdom
of Saudi Arabia $1,400,000,000 worth of arms, including 900 Joint Direct
Attack Munition (JDAM) kits, which are applied to conventional bombs to
make them laser-guided bombs; and
Whereas the Administration should cease the sale of weapons to Kingdom of Saudi
Arabia unless and until it increases its production of crude oil: Now,
therefore, be it
Resolved by the Senate and House of Representatives of the United
States of America in Congress assembled,
SECTION 1. LIMITATION ON CERTAIN PROPOSED SALES OF DEFENSE ARTICLES AND
DEFENSE SERVICES TO THE KINGDOM OF SAUDI ARABIA.
(a) Limitation.--The issuance of a letter of offer with respect to
each proposed sale of defense articles and defense services to the
Kingdom of Saudi Arabia specified in subsection (b) is hereby
prohibited unless the Kingdom of Saudi Arabia--
(1) commencing not later than 30 days after the date of the
enactment of this Joint Resolution, increases its oil
production by 1,000,000 barrels of oil per day in excess of its
oil production as of January 1, 2008 (as reported by the
International Energy Agency); and
(2) maintains such increased oil production for not less
than 90 days after the date on which such increased oil
production is reached (as so reported).
(b) Proposed Sales of Defense Articles and Defense Services.--The
proposed sales of defense articles and defense services to the Kingdom
of Saudi Arabia specified in this subsection are the proposed sales as
follows:
(1) The proposed sale of defense articles and defense
services to the Kingdom of Saudi Arabia described in the
certifications transmitted to the Speaker of the House of
Representatives and the Chairman of the Committee on Foreign
Relations of the Senate pursuant to section 36(b) of the Arms
Export Control Act on October 4, 2007 (Transmittal Number 08-
03).
(2) The proposed sale of defense articles and defense
services to the Kingdom of Saudi Arabia described in the
certifications transmitted to the Speaker of the House of
Representatives and the Chairman of the Committee on Foreign
Relations of the Senate pursuant to section 36(b) of the Arms
Export Control Act on December 7, 2007 (Transmittal Number 08-
28).
(3) The proposed sale of defense articles and defense
services to the Kingdom of Saudi Arabia described in the
certifications transmitted to the Speaker of the House of
Representatives and the Chairman of the Committee on Foreign
Relations of the Senate pursuant to section 36(b) of the Arms
Export Control Act on December 7, 2007 (Transmittal Number 08-
29).
(4) The proposed sale of defense articles and defense
services to the Kingdom of Saudi Arabia described in the
certifications transmitted to the Speaker of the House of
Representatives and the Chairman of the Committee on Foreign
Relations of the Senate pursuant to section 36(b) of the Arms
Export Control Act on January 14, 2008 (Transmittal Number 08-
18).
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