The letter comes days after the national average price of gasoline hit $5 per gallon. Prices were $2.39 per gallon when President Joe Biden entered the Oval Office at the beginning of last year — contributing to overall inflation, which reached 8.6% for consumers and 10.8% for businesses as of last month.
“There is no question that Vladimir Putin is principally responsible for the intense financial pain the American people and their families are bearing,” Biden wrote in his letter to seven oil and gas companies. “But amid a war that has raised gasoline prices more than $1.70 per gallon, historically high refinery profit margins are worsening that pain.”
Oil company profits have indeed risen in recent months. ExxonMobil, for instance, reported $5.5 billion in profits during the first quarter of 2022, despite taking a $3.4 billion hit due to its departure from Russia. During the fourth quarter of 2021, ExxonMobil reported an $8.87 billion profit — its largest in seven years.
Nevertheless, Heritage Foundation research fellow Katie Tubb noted to The Daily Wire that President Biden failed to mention “any connection between his administration’s policies and high gasoline prices” in the letter.
“It has been the consistent message and persistent policy choice of this administration to pursue an anti-oil regulatory agenda,” Tubb explained. “The only logical conclusion of policies designed to forcibly wean Americans off conventional fuel is higher prices. California is a clear example — similar policies have been on the books for years and it is no surprise that Californians consistently have to pay some of the highest prices in the country for gasoline.”
Multiple White House officials — including Transportation Secretary Pete Buttigieg, Energy Secretary Jennifer Granholm, and President Joe Biden himself — have argued that high gas prices will accelerate a transition to green energy.
Even on Wednesday, CNN anchor John Berman confronted Granholm over the Biden administration’s letter, asserting that asking oil companies to decrease their profits could be difficult when the Biden administration has pursued the overall decline of fossil fuel production. “What we’re saying is today we need that supply increased,” Granholm responded. “Of course, in five or 10 years, actually in the immediate, we are also pressing on the accelerator, if you will, to move toward clean energy so that we don’t have to be under the thumb of petro-dictators like Putin.”
In response to Biden’s letter, ExxonMobil said on Wednesday that the Biden administration could stimulate more oil production through “predictable lease sales, as well as streamlined regulatory approval and support for infrastructure such as pipelines.”
Indeed, Republican lawmakers have criticized Biden for a “de facto ban on new drilling” achieved by “sitting idle on over 9,000 drilling permits” and millions of acres of inactive leases. Likewise, the White House faced backlash for nixing expansions to the Keystone XL Pipeline last year. More recently, former White House Press Secretary Jen Psaki revealed that the Biden administration had “no plans” to reconsider opening pipeline construction.
Among other recommendations, Tubb told The Daily Wire that Biden could work to “relieve federal regulatory burdens on refineries.” She observed that the cost for refineries to comply with the Renewable Fuel Standard — by which the Environmental Protection Agency (EPA) mandates certain volumes of biofuel in gasoline and other energy products — “are at record highs and ultimately get passed down to customers.”