A coalition of 10 oil and natural gas trade associations representing small- to mid-size producers blasted President Joe Biden last week for blaming the industry for high energy prices.
“Oil and gas companies shouldn’t pad their profits at the expense of hardworking Americans,” Biden wrote in a Twitter post highlighting the disconnect between crude oil prices and the price of gasoline, dismissing complexities in the supply chain that cause those prices to come down slower than the cost of crude. The phenomenon is known as the “rockets and feathers” effect.
Biden’s blame on the industry he’s sought to handicap since day one of his administration comes after the president’s repeated efforts to scapegoat Russian President Vladimir Putin and the Organization of Petroleum Exporting Countries (OPEC) failed to convince the public. According to an Emerson poll conducted over the weekend, nearly 40 percent of voters blame Biden for soaring energy prices, while only 18 percent say oil and gas companies are responsible.
Apparently deploying the White House-friendly TikTok influencers didn’t work as the administration hoped. Now the oil and gas companies have called, and they’d like to resume their operations Biden put to a halt. Is Benny Drama there?
“Mr. President, we as representatives of critically important small and midsized energy producers are committed to do what we can at this moment on behalf of the American people,” the coalition of trade groups wrote Friday. “The time is now to work together to address our energy, and, indeed, national, security needs.”
Earlier this month, already high gas prices sustained throughout the president’s 14-month tenure reached a new peak at $4.33 a gallon. According to AAA’s gas tracker, prices remain less than 10 cents from the new all-time high at $4.24 as of Tuesday evening.
While executives at major oil companies met with the president at the White House Monday, representatives from small- and mid-size producers were excluded from the talks on how to ramp up production to offset interruptions in global markets.
The absence of small- and mid-size producers at the White House to navigate turbulence in the energy markets is no small oversight. Independent producers, defined by the Internal Revenue Service (IRS) as those with less than $5 million in annual retail oil and gas sales or with less than an average of 75,000 barrels of crude oil refined on a daily basis, are responsible for producing 83 percent of America’s oil and 90 percent of America’s natural gas. Unlike their larger corporate rivals such as Exxon, these comparatively small producers are ill-equipped to adapt to the cascade of taxes and regulations from the Biden administration to keep their operations sustainable.
Biden’s outreach to the oil giants while ignoring small-scale producers not only signals the return of the corporate swamp culture that’s drowned public trust in Beltway institutions, but also highlights an alliance of Washington leaders catering to those who’ve fallen in line with rhetoric on environmental, social, and corporate governance (ESG). Biden’s invite extended to Exxon Mobil, ConocoPhillips, and Marathon Petroleum.
“It’s telling who he reached out to,” said Daniel Turner, the founder and executive director of the energy non-profit Power the Future. “A lot of corporate America speaks the climate language for convenience, for political reasons. It keeps protestors out of their corporate headquarters… They can [also] absorb the additional regulations and costs that the Biden administration imposes on the industry at large.”
In the absence of a personal invite to the White House like their large competitors, trade groups used their letter to explain actions the president could take immediately to ramp up domestic oil and gas production suppressed by the administration.
“There are 4,621 permits to drill awaiting approval by the Department of Interior’s Bureau of Land Management. Your appointees could approve these permits now, enabling communities to [move] forward with development,” the coalition wrote. “So, yes, Mr. President, your administration is ‘holding the industry back’ in direct contradiction to your statements last week when you said your administration was not… We stand ready to assist in any way possible.”