Experts: Oil Companies May Be Keeping Gas Prices High to Rake in Record Profits Democratic lawmakers seek to hold oil executives accountable for price-gouging at the pumps.
By Main Street Sentinel Staff
New reports show that oil companies are making record profits as gas prices rise across the United States.
Some are suggesting that oil companies are intentionally keeping gas prices high during a time of crisis. They point to gas prices rising to over $4 per gallon in the U.S. in early March as oil traded at highs of $130 per barrel. But even as per barrel prices dipped below $100 by the middle of the month, gas prices remained at nearly $4.40 per gallon.
On Twitter, President Joe Biden put the blame squarely on corporate greed.
“Oil prices are decreasing, gas prices should too,” Biden wrote. “Last time oil was $96 a barrel, gas was $3.62 a gallon. Now it’s $4.31. Oil and gas companies shouldn’t pad their profits at the expense of hard-working Americans.”
Oil companies aren’t the only corporations reaping record profits while raising prices. Starbucks joined everyone from soft-drink giants Coca-Cola and Pepsi to meat-processing firms Purdue and JBS in announcing an increase in prices, blaming rising labor costs and supply chain disruptions. But in the last three months of 2021, Starbucks raised their prices twice, increasing their profits by 31 percent to $816 million.
Experts point to oil companies engaging in similar price-gouging, holding nearly 9,000 approved but unused drilling permits for millions of acres of federally owned lands, according to a December 2021 report by the Bureau of Land Management. But rather than increasing domestic production to help alleviate the burden Americans are feeling at the pumps, oil industry lobbyists are clamoring for the government to open up even more public lands for drilling.
Congressional Democrats are seeking to reverse the trend by introducing a corporate windfall tax, particularly with many oil companies paying negative taxes in the U.S. even while realizing record profits. A report by U.K.-based think tank Common Wealth found that ConocoPhillips, Chevron, ExxonMobil, Hess Corporation, and Devon Energy got a combined $1.95 billion back in domestic taxes between 2015-2022. Those same companies paid $77.2 billion to other governments over the same period. Additionally, they combined to give investors $201.4 billion in dividends and share buybacks.
“Big Oil is raking in record profits while working families are struggling to afford gas at the pump,” California Congressman Ro Khanna told The New Republic. “What we are seeing right now is a prime example of corporate greed and companies profiting off an international crisis.”