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Oil industry groups are reacting as President Joe Biden threatens on Monday with a potential windfall tax or other repercussions if oil companies do not invest in boosting US production and lowering consumer prices.

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The president, saying in a speech on Monday that oil companies’ recent profits were “a windfall of the war” in Ukraine, urged them to use some of the profits to boost U.S. production and refining capacity, as well as lower the gas prices Americans see at gas stations. . He said he believed they had a “responsibility to act in the best interest of their consumers, their community and their country.”

BIDEN REDUCES OIL COMPANIES’ PROFITS, THREATENS TO COLLECTION INCIDENTAL TAXES AS PENALTY

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“If they don’t, they will pay higher tax on their excess profits and face other restrictions,” Biden said. “My team will work with Congress to consider these options available to us and others. It’s time for these companies to stop profiting from the war.”

AT statement On Monday, American Petroleum Institute (API) President and CEO Mike Sommers said American families and businesses are “looking to lawmakers for solutions, not campaign rhetoric.”

Sommers also accused the Biden administration of taking responsibility “for every dime of gas price cuts, but when prices go the other way, they start pointing the blame” in a call to reporters Tuesday morning.

He argued that “higher taxes on American energy discourage investment in new production” both in a statement and in a conversation with reporters, stating that global markets determined gasoline prices. He also told reporters that “bad policies matter.”

FORMER OBAMA ECONOMIC ADVISER QUESTIONED BIDEN’S PROPOSED FINDING TAX

Appearing on Kudlow that afternoon, Sommers denied Biden’s “war profiteering” comment.

“The accusation they made against this industry – an industry, by the way, self-sanctioned and refused to accept Russian oil anymore at the beginning of this terrible war going on in Europe, an industry that itself came out of Russia without bandages. from the federal government – if they say that this industry, the most patriotic industry that I know in our country, will be profiteering in the war – this is an absolutely outrageous comment, ”he said.

Chet Thompson, CEO and president of American Fuel and Petrochemical Manufacturers, accused Biden of being “more concerned about political stance” ahead of the midterm elections than about “advancing energy policies that really benefit the American people.”

“A windfall tax can get a good reputation, but from a policy standpoint, it’s bad for consumers,” he said. in a statement. “This is likely to reduce incentives to produce fuel and worsen the situation for drivers.”

President Biden speaks at an event

This was announced on Tuesday by White House spokesman Abdullah Hassan.

“This wealth comes from an industry that is using its record profits to line the pockets of shareholders, instead of ramping up production and processing capacity so families can pay less for gas,” he said.

Hasan, echoing part of Biden’s comments on Monday, said that “the six largest oil companies have made more than $100 billion in profits in the last six months alone,” before saying they spent more than $50 billion on dividends and share buybacks.

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“Of course they want to continue to profit from wartime with impunity,” he continued. “But the president has made it clear that if they don’t change their behavior, he will hold them accountable to protect the interests of American families.”

Biden said on Monday that people will “hear more” on the issue “when Congress returns.”

gas pump

At press time, the national average price of regular gasoline was $3,758, up from $3,800 a month ago and $3,402 a year ago. according to AAA. In mid-June, the AAA reported that the average price of regular unleaded gasoline nationwide hit an all-time high of $5,016.