President Biden sent letters to oil companies Wednesday telling them to produce more gas to ease widespread pain at the pump, which he also blamed on Russian President Vladimir Putin.
In a three-page letter, he said Americans have been forced to shell out more dollars for fuel because refinery capacity has been sluggish.
“Amid a war that has raised prices more than $1.70 per gallon, historically high refinery profit margins are worsening that pain,” Mr. Biden wrote to six companies.
Mr. Biden said he will convene an emergency meeting on gas prices with Energy Secretary Jennifer Granholm in the coming days. In blunt terms, he said the companies “need to work with my administration” on concrete solutions as he tries to shift blame for soaring costs off his shoulders and onto Big Oil and the Russians.
Gas prices have risen to an average of $5 per gallon across the country at the start of the summer driving season. Demand is picking up after the worst of the pandemic but supply remains short.
Mr. Biden said refiners are trying to shake off the COVID-19 cobwebs, but he is worried about a disconnect between the price of oil and gasoline, saying the cost of gas role to an average of $5 from $4.25 in March even though oil cost about $120 per barrel in both instances.
“The difference — of more than 15% at the pump — is the result of the historically high profit margins for refining oil into gasoline, diesel and other refined products. Since the beginning of the year, refiners’ margins for refining gasoline and diesel have tripled and are currently at their highest levels ever recorded,” Mr. Biden wrote. “I understand that many factors contributed to the business decisions to reduce refinery capacity, which occurred before I took office. But at a time of war, refinery profit margins well above normal being passed directly onto American families are not acceptable.”
Mr. Biden sent letters to Marathon Petroleum Corp.; Valero Energy Corp.; ExxonMobil; Phillips 66; Chevron; BP; and Shell.
Throughout the letter, Mr. Biden characterized the effort as a joint campaign against Mr. Putin, whose invasion of Ukraine caused shocks to the oil market.
“I appreciate your immediate attention to this issue and your efforts to mitigate the economic challenges that Vladimir Putin’s actions have created for American families,” he wrote.