Energy industry executives clapped back at President Biden for threatening higher taxes on oil companies if they don’t lower the price at the pump.
The industry’s lobbying firm, the American Petroleum Institute, described Mr. Biden’s price gouging assertions as “outrageous” and “baseless,” denouncing the president’s tax threat as “campaign rhetoric” that will only further disincentives new production needed to blunt rising prices.
“He repeated the same debunked assertions he’s made in the past and again arrived at a policy proposal that would do the exact opposite of what would help families and businesses in this country,” API President and CEO Mike Sommers told reporters Tuesday. “This has become a trend: the administration takes credit for every cent of decrease in gasoline prices, but when prices go the other way, the finger-pointing begins.”
Chevron CEO Mike Wirth offered a similar warning about the president’s rhetoric deterring production, saying a windfall profit tax or export ban would be “short-sighted.”
“Typically, if you want less of something, you tax it,” he said on Bloomberg TV.
Quarterly profits for the globe’s largest oil companies continued to soar during the most recent three-month period ending in September. Shell and ExxonMobil, for example, each made $9.5 billion and $18.7 billion in profits, respectively.
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In a speech Monday, Mr. Biden demanded that the energy industry cease its “war profiteering” or else “they’re going to pay a higher tax on their excess profits.”
Mr. Biden, as he’s consistently done since Russia invaded Ukraine, accused energy companies of bilking drivers under the guise of war and advocated for large portions of their profits to be taxed by the government to force pump prices lower.
“Record profits today are not because they’re doing something new or innovative. The profits are a windfall of war. The windfall from the brutal conflict that is ravaging Ukraine and hurting tens of millions of people around the globe,” he said. “You know, at a time of war, any company receiving historic windfall profits like this has a responsibility to act beyond the narrow self-interest of its executives and shareholders.”
While the war — coupled with demand for oil that continues to outpace supply — has helped keep gasoline prices high, oil companies do not set the prices at the pump. Oil market prices, the main contributor to fuel prices, remained high as of Tuesday around $90 per barrel with the average price for a regular gallon of gas at $3.76, according to AAA.
Mr. Sommers said he’s hopeful a Republican takeover of at least one chamber of Congress would mean more pro-fossil fuel legislation being passed.
“Republicans plan to make energy a top priority, based on plans they’ve put out,” he said. “There could be a real opportunity, if there is Republican control of one of the chambers, for us to get some bipartisan energy policy through.”