Gas Prices: Biden Tells Oil Companies to Explain Production Cuts
By: Zahra Tayeb (Markets Insider)
Yeah, Joe, pumping more oil won't do much if that oil can't be refined. So, Biden's historic actions were only intended to pander instead of addressing real problems.
Demand for refined products fell sharply during the pandemic. Wise bureaucrats decided that was the perfect time to impose new environmental requirements on oil refineries and ethanol producers. No one should be surprised that some older facilities were shuttered rather than retrofitted to meet the new environmental requirements. Retrofitting facilities does require time and money; it's not as easy as writing regulations.
Up until now the emphasis has been on creating an oil-free future. The bureaucratic emphasis has been to favor alternative energy and new technology while creating disincentives for fossil fuel. The policy mantra has been 'oil is bad'. Governments at the Federal and state levels decided to just pull the plug rather than plan a transition.
And Biden failed to see this coming?
Notice that Biden is not claiming credit for rejoining the international climate accord or cutting emissions. Biden is searching for scapegoats to take the blame for Biden's own policies and Biden's own inattention to planning for a transition. What we are experiencing is a lack of leadership and planning in government.
S E E D E D C O N T E N T
President Joe Biden has demanded oil companies explain why they are cutting gasoline production in a letter viewed by Reuters, as prices soar to record highs right in the middle of the summer driving season.
In the letter written to gas companies including Marathon Petroleum, Valero Energy, Exxon, Phillips 66, Chevron, BP, and Shell, Biden criticized them for cutting back on oil refining to rake in higher profits.
"At a time of war, refinery profit margins well above normal being passed directly onto American families are not acceptable," Biden said.
He added: "The lack of refining capacity - and resulting unprecedented refinery profit margins - are blunting the impact of the historic actions my Administration has taken to address Vladimir Putin's Price Hike and are driving up costs for consumers."
Energy costs are dramatically rising in the US, partly as a result of Russia's war against Ukraine. Average gas prices in the US hit a record high of $5 a gallon for the first time, data from the AAA shows, up about 63% from the same time last year. US crude oil, meanwhile, has surged 82% in the same time.
Prices are surging across the West Coast, with an average price of $6.435 in California and $5.55 in Washington.
It adds to the problem of red-hot inflation in the US that has driven up costs of essential goods and services for many American consumers. In May, the US Consumer Price Index unexpectedly rose by 8.6% - the highest inflation rate since December 1981.
And while the Federal Reserve already hiked interest rates by 0.5 percentage points in May to tackle inflation, economists predict the central bank could increase rates by even more at its next meetings.
Increasing pressure from Biden follows his recent attacks on energy companies for pulling in huge profits as Americans pay record prices at the pump. Recently, he singled out Exxon Mobil, saying they've "made more money than God this year and, by the way, nothing has changed."
He further complained that his administration's plan to focus on ethanol and biofuels was a useless strategy in helping to bring down gas prices.
High crude oil prices are one problem, but bottlenecks at oil refineries are making it worse. Refineries were struck hard by the COVID-19 pandemic, with many shutting down operations in both 2020 and 2021. To that effect, the inability to ramp up production is putting further pressure on gas prices, prompting analysts to say there are no quick fixes to the current crisis.
Tags
Who is online
593 visitors
C'mon, Joe. Don't gaslight the public with pandering and scapegoating. What is happening is what Biden's policies (?) were intended to do. Biden is really a victim of his own success. How's that working out for everyone?
Biden Tells Oil Companies To Explain Production Cuts
Why don't we start with Biden why HE Revoked the March 2019 Permit for the Keystone XL Pipeline.
Keystone XL is one of those supply chain issues that people outside the political beltway don't understand. Joe's problem is that refineries are at the end of the supply chain. Historic pandering to flood the supply chain won't solve the problem.
Automakers are going all-in on EVs. Biden touts that all electric Hummer as a tremendous success. And Joe wants to blame oil businesses for reading the tea leaves and seeing no future in expansion of oil production and refining? Oil companies are trying to transition to energy companies by investing in alternatives. That money can't be spent twice -- unless Biden nationalizes oil.
Yep and we see how well that worked in places like Venezuela.
How is Canadian oil part of this topic?
Lets see:
Joe gets elected
Joe tells America his goal is to put fossil fuel out of business.
Joe starts making it harder for companies to drill and refine oil
Oil companies stop pouring money into development of drilling and refineries in hopes things will change when Joe is out.
And Joe is wondering why there are production cuts?
I wonder how he shaves in the morning since it is obvious he is incapable of looking in the mirror.
This is the type of asshattery that politicians are so good at.
You can’t trust most of them.
I don't know why Joe is asking, he has already told us.
But but but Trump
But but but Putin
But but but Oil Companies
But but but Racism
But but but Parents are domestic terrorist's
But but but Insurrection
But but but Republicans
I am sure there are more but Joe mumbles so much it is sometimes hard to know what he is saying.
Because that is what his handlers told him to say. Maybe even that addict son of his.