Exxon made more money than god, says Biden, criticises high gasoline prices

President Joe Biden accused Exxon Mobil Corp. and other oil companies of exploiting high gasoline prices after a report showed inflation soaring to a new 40-year record. 
 

“We’re going to make sure everyone knows Exxon’s profits. Exxon made more money than God last year,” Biden said during an event at the port of Los Angeles. 

Exxon’s profits are forecast to almost double to $43 billion this year, which would be its second-best performance on record. The Texas oil giant’s fortunes directly collide with those of consumers, who are paying more for fuel than ever before. Regular gasoline averaged $4.99 a gallon nationwide on June 10, according to AAA.

Surging energy costs -- fueled by underinvestment in new drilling, Covid-19 shutdowns and Russia’s war in Ukraine -- have become a top political challenge for Biden as he heads into midterm elections in November. But blaming energy companies is unlikely to encourage them to spend more on increasing supplies, especially when Democrats and investors have spent the last few years pushing for lower carbon emissions. 

Biden urged domestic oil companies to ramp up production, saying they would rather buy back their own stock than drill on land where they have permits. 

“The reason they’re not drilling is they’re buying back their own stock, which should be taxed quite frankly, buying back their own stock and making no new investments,” Biden said. “So I always thought Republicans are for investment. Exxon: start investing and start paying your taxes, thanks.”

A spokesman for Exxon, Casey Norton, said that the company has “been in regular contact with the administration, informing them of our planned investments to increase production and expand refining capacity in the United States.”

Exxon expects to increase production from the Permian Basin, the largest US oil field, by 25% this year, and has plans to increase refining capacity by about 250,000 barrels per day, “the equivalent of adding a new medium-sized refinery,” Norton said. 

The company reported losses of more than $20 billion in 2020 and borrowed heavily to support production during the pandemic, he noted. In 2021, total taxes on Exxon Mobil’s income statement amounted to $40.6 billion, Norton said. 

The president spoke during a visit to the Port of Los Angeles, where he defended his economic record and deflected blame for inflation, which spiked 8.6% in the year to May according to a Labor Department report on Friday.

Biden’s treasury secretary, Janet Yellen, has rejected the idea corporate greed is contributing to inflation, breaking with the president and other top Democrats who have accused major companies of price gouging or raking in excessive profits. 

“Demand and supply is largely driving inflation,” Yellen said Thursday at a New York Times event when asked if corporate greed is causing prices to rise.