INDUSTRY PUSHES BACK: The oil and gas industry is bobbing and weaving as the Biden administration and congressional Democrats punch at domestic producers over high energy prices.
President Joe Biden has found himself in the position of trying to address voter worries over rising prices — particularly gas prices — while pursuing the goal of reducing fossil fuel use over time.
That has led to his blaming oil and gas companies for the current outlook, in the form of a request that the Federal Trade Commission investigate companies for anti-competitive conduct, rather than his asking them to expand production.
Producers are also being targeted by Democratic lawmakers, some of whom have called on Biden to impose a ban on fuel commodity exports. Sen. Elizabeth Warren of Massachusetts, (who has proposed a complete ban on fracking), is one of said lawmakers and has gone a step further, accusing 11 energy companies of “corporate greed” in a recent spate of letters to the firms’ executives.
Companies say they’re being scapegoated: ExxonMobil CEO Darren Woods dismissed the accusations from Biden and Warren in an interview this morning, implicating market dynamics.
“This is a commodity market. The prices are set by the amount of supply that’s out there, and by the amount of demand,” said Woods.
The heads of Marcellus Shale Coalition, the Gas & Oil Association of West Virginia, and the Ohio Oil & Gas Association, whose members operate in the Appalachian region, wrote Warren yesterday over her letters, calling her claims part of a “deeply misguided, headline-grabbing ploy” and boasting the industry’s role in shaping the energy-cheapening shale revolution.
The industry is made up of “price takers, not price makers,” Mike Chadsey, director of public relations for the Ohio Oil & Gas Association, told Jeremy. “Other people tell us what our commodity was worth.”
Charlie Burd, executive director of the Gas & Oil Association of West Virginia, called the claim that companies are profiting off exports at someone else’s expense “unfair” and said that global supply chains and U.S. allies are strengthened by exported gas.
He also noted that natural gas prices hit an all-time low during the pandemic, calling it “supply and demand 101” that prices would increase with the demand during the pandemic recovery.
“You can’t look at prices over just a very short period of time,” Burd said. “We have to understand that the bigger picture is all commodities shift in price.”