WASHINGTON (AP) – A forward-looking Chevron chief complained on Tuesday that President Joe Biden had tarnished energy companies at a time when petrol prices were near record highs, and the president replied that the oil company’s chief executive was “softly sensitive.”
In recent weeks, the president has criticized oil producers and refineries for maximizing profits and making “more money from God” instead of increasing production in response to higher prices as the economy recovers from the pandemic and feels the effects of Russia’s invasion of Ukraine. .
Michael Wirth, chairman and CEO of Chevron, sent a letter to Biden by e-mail on Tuesday saying the president’s words were self-destructive in encouraging companies to increase production.
Chevron is investing in more production, Wirth writes, but your administration is largely trying to criticize and sometimes denigrate our industry. These actions are not helpful in meeting the challenges we face, and they are not what the American people deserve. “
The oil company’s chief executive said he wanted more cooperative relations with the government.
“Let’s work together,” Wirth wrote. “The American people rightly expect our country’s leaders and industry to meet the challenges they face in a serious and decisive way.
Asked about these comments, Biden expressed no sympathy.
“He’s a little sensitive,” Biden said. “I did not know that they would hurt their feelings so quickly. Look, we need more refining capacity. This idea that they don’t have oil to drill and take out is simply not true. “
Average gas prices are nearly $ 5 a gallon across the country, tensions for travelers and political albatross for Biden’s fellow Democrats, who will run in the midterm elections. This prompted the White House to fight for decisions, including a possible suspension of the federal gas tax of 18.4 cents a gallon. Biden plans to decide by the end of the week whether the tax should be suspended, a move aimed at easing price pressures, and that it will need approval from a reluctant Congress.
The gas tax finances highways, but Biden said Tuesday that all lost revenue will not have a big impact on road construction due to last year’s $ 1 trillion infrastructure law.
The clash between the Biden administration and oil producers and refineries took place ahead of Thursday’s meeting with Energy Minister Jennifer Granholm with energy companies.
Both House Speaker Nancy Pelosi and Senate Republican leader Mitch McConnell have previously expressed skepticism about the benefits of suspending the gas tax. But Adam Schiff’s representative, D-Calif., Is sponsoring a bill that will postpone the gas tax until the end of 2023.
Schiff said in a statement that he had contacted the White House to promote the gas tax holiday, adding: “But we should not stop there. We must also hold Big Oil responsible for raising prices, which leads to higher prices in the first place. “
The House of Representatives approved legislation to combat alleged price increases by oil companies, but the bill stalled in the Senate. Democratic proposals to tax unforeseen profits on oil producers have generated little support in Congress.
The possibility of levying a tax on natural gas has drawn criticism from economists and the business community for failing to address key supply challenges.
Addressing the New York Economic Club, a non-profit, non-partisan business group, on Tuesday, Target CEO Brian Cornell called the gas tax holiday a temporary “mini-stimulus” that does nothing to fundamentally change the supply and demand curve. fuel and transport.
“We have a classic supply and demand challenge,” Cornell told the audience. “With all due respect, the gas vacation will only satisfy the demand for fuel. It does nothing to increase supply. “
Harvard University professor Jason Furman, a former top economist at the Obama White House, said stopping the gas tax would not cope with supply pressures.
“Refineries are even more limited now, so supply is almost completely inelastic,” he wrote on Twitter. “Most of the 18.4 cent reduction will be in the industry’s pocket – with perhaps a few cents passed on to consumers.
White House spokeswoman Carin Jean-Pierre told reporters that the administration was looking for as many ways as possible to provide consumers with some relief from the gas station. But the administration has no plans to tell Americans to drive less during the July 4 holiday and reduce some of the pressure on supplies.
“Americans will do what they think is right for themselves and their families,” Jean-Pierre said. “It’s not something we judge.”
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AP reporters Matthew Daly in Washington and Ann D’Inocenzio in New York contributed to the report.
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