(CNSNews.com) - President Joe Biden, a lifelong politician with no background in running a business, is once again blasting oil companies, even threatening them, for earning large profits.
"I think it's outrageous what their — the — the size of the profit," Biden said on Monday:
"Here’s why it matters," Biden continued:
"If these companies were making average profits they’ve been making by refining oil over the last 20 years instead of the outrageous profits they’re making today, and if they passed the rest on to the consumers, the price of gas would come down around an additional 50 cents.
If they’re investing their profits in the historic — at historic rates in their U.S. operations, then America would be producing more oil today and prices would be down even further. But rather than increasing their investments in America or giving American consumers a break, their excess profits are going back to their shareholders and to buying back their stock, so the executive pay is — are going to skyrocket.
"Give me a break. Enough is enough."
Biden said the record oil company profits are a "windfall of war," and he said oil companies "have a responsibility to act in the interest of their consumers, their community, and their country; to invest in America by increasing production and refining capacity. Because they — they don’t want to do that. They — they have the opportunity to do that — lowering prices for consumers at the pump.
"You know, if they don’t, they’re going to pay a higher tax on their excess profits and face other restrictions," Biden threatened.
"My team will work with Congress to look at these op- — these options that are available to us and others. It’s time for these companies to stop war profiteering, meet their responsibilities to this country, and give the American people a break and still do very well."
The American Petroleum Industry issued the following statement in response:
"Rather than taking credit for price declines and shifting blame for price increases, the Biden administration should get serious about addressing the supply and demand imbalance that has caused higher gas prices and created long-term energy challenges.
"Today, the President proposed to raise taxes on the U.S. natural gas and oil industry that is competing globally to produce the fuels Americans need every single day. Oil companies do not set prices—global commodities markets do.
"Increasing taxes on American energy discourages investment in new production, which is the exact opposite of what is needed. American families and businesses are looking to lawmakers for solutions, not campaign rhetoric.”
"Analysis of a windfall profits tax established in 1980 have found that it decreased domestic energy production and increased reliance on imported oil. According to the Congressional Research Service, the tax reduced domestic production by as much as 8 percent from 1980 to 1988 when it was repealed in part because “it made the United States more dependent on foreign oil."
What President Biden did not say is that oil companies experienced record losses during the COVID pandemic, when oil prices collapsed.
According to an article published by the Bureau of Labor Statistics in October 2020:
"As economic activity slowed sharply across the globe, demand for petroleum and petroleum products plummeted.
“The drop in demand, coupled with an unexpected increase in supply, led to a collapse in crude oil prices and subsequent impacts on prices for refined petroleum products and other downstream items, notably gasoline.
"As economies reopened, the initial price downturn gave way to reduced oil production and some renewed demand. As a result, prices for oil products partially recovered."
President Biden is a green energy/climate change acolyte. Even during his presidential campaign, he declared his intention to transition from fossil fuels to renewable energy, which discouraged investment by the oil industry.
In a March 2020 debate, before becoming president, Biden said: "Number one, no more subsidies for fossil fuel industry. No more drilling on federal lands. No more drilling, including offshore. No ability for the oil industry to continue to drill, period, ends, number one."
As recently as this past May, President Biden hailed higher gas prices as an "incredible transition."
"When it comes to the gas prices, we're going through an incredible transition that is taking place that, God willing, when it's over, we'll be stronger and the world will be stronger and less reliant on fossil fuels when this is over," Biden said.