Wednesday PM March 12th, 2008
by: Ed Mayberry, March 12, 2008 12:03:00 pm
French prosecutors have asked a judge to put Continental Airlines and four people on trial for manslaughter. The case arises from the 2000 crash of a Concorde jet shortly after takeoff from Paris' Charles de Gaulle Airport that killed 113 people, including four on the ground. The prosecutor's office in suburban Paris says it submitted the recommendation for trial in late February. The court isn't bound to follow the prosecutors' suggestion and it's unclear when the judge would respond to the request. French investigators blamed the crash of the Air France Concorde on a titanium strip left on the runway by a Continental Airlines DC-10. The metal strip caused one of the Concorde's tires to burst, which sent debris flying that punctured the jet's fuel tanks. Houston-based Continental maintains that it wasn't responsible for the crash.
Democrats and Republicans on Capitol Hill are offering rival election year budget plans that highlight the trade-offs the next president is likely to face. Democrats are offering a $3 trillion plan that aims to ultimately balance the budget. It would provide increases for many domestic programs, but assumes increased tax revenue will come in when President Bush's tax cuts expire in about three years. The Republican alternative would preserve those cuts as well as other tax breaks. The price includes cuts in Medicare and Medicaid as well as housing and community development programs. Debate over the budget resolution sets the stage for follow-up bills affecting taxes and benefit programs and annual appropriations bills. Unless the follow-up legislation is passed, the budget debate has little real effect but does lay out party priorities. The first votes are not expected until Thursday.
Former Enron CEO Jeff Skilling is seeking notes made by FBI agents of statements made by former Enron finance chief Andy Fastow that Skilling says bolster his claims of innocence in his 2006 trial. Skilling's defense attorney Daniel Petrocelli is slated to argue Skilling's appeal of his 24-year sentence in New Orleans next month. The 5th Circuit Court of Appeals could postpone those arguments to hear the dispute over the 400 pages of FBI notes.
Gasoline prices have notched a new record, causing additional pain for consumers. And the rise in oil prices is continuing. The national average price of a gallon of regular gas rose by nearly two cents overnight, according to AAA and the Oil Price Information Service. Many analysts expect fuel prices to moderate, while others predict oil could keep rising to $120 a barrel, or higher. And with demand for gas expected to rise as warm weather arrives, analysts say pump prices could spike as high as $3.75 a gallon, regardless of what happens with oil prices. The Energy Department on Tuesday raised its forecast of how high prices will rise this spring by a dime to $3.50 a gallon. The national average for prices at the pump is near $3.23, beating the previous record seen last May.
Record spending has helped push the federal deficit to a record high over the past five months. The Treasury Department says the deficit for the budget year that began October 1st is up 62 percent from the red ink for the same five-month period a year earlier. The current $263.3 billion deficit is an all-time high. Just for February, the government ran in the red by $175.6 billion, a record for any single month. The White House predicts the deficit will reach $410 billion as the economic slowdown cuts into tax revenues. The Bush administration and some economists hope growth will pick up in the second half of this year as the government's tax rebates and business tax breaks ripple through the economy.
Iraq says it regrets complaints by U.S. officials that it's not spending much of its own money, even as America's getting squeezed by record oil prices. Iraqi government spokesman Ali al-Dabbagh says progress is being made in investments, developing public services and spending for reconstruction. But U.S. auditors are telling lawmakers that Iraq is mismanaging oil revenue. Al-Dabbagh says the government is keeping an eye on local authorities and plans to spend money despite terror threats. He had no details of that spending plan. Iraq's oil exports rose 9.2 percent last year, largely because of improved security. Exports in 2007 reached an average of 1.6 million barrels a day, selling at prices ranging from $48 to $83 a barrel.
ConocoPhillips lowered its long-term production growth rate to two percent from a previous forecast of three percent. The Houston-based company says its goal is value, not volume. The third-largest U.S. oil company also said it expects its reserve-replacement rate to exceed 100 percent over the next five years. Reserve replacements represent the ratio of reserves found over production for a given period. Analysts typically say a company's reserve replacements should average more than 100 percent over a three- to five-year period to indicate growth. Proved reserves are a key asset of oil companies. In February, ConocoPhillips said it lost the equivalent of more than a billion barrels of oil when its Venezuelan operations were expropriated last year. That left the company to replace less than a third of its 2007 output with new reserves. Excluding the assets seized by the Venezuelan government in an ongoing dispute, the company said it replaced 159 percent of production.
The 21st annual presentation of Hart Energy Publishing's "Refining and Energy Company of the Year" awards are set for this evening in San Diego. This year's recipients are international honoree Shell Oil and North American honoree ConocoPhillips. Winners were selected based on corporate commitment and achievement in three categories: cleaner environment, investment and corporate growth and vision.