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Exxon Mobil fights back against Biden

Washington Examiner logo Washington Examiner 6/16/2022 James Sweet
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President Joe Biden’s letter to oil refiners was another attempt by the White House to point fingers at companies over the current energy crisis. Exxon Mobil, one of the multiple companies targeted by Biden, is not letting these accusations fly without opposition.

In a statement released Wednesday afternoon, Exxon Mobil defended its activities and listed the investments it made before and during the pandemic. “Globally, we’ve invested double what we’ve earned over the past five years — $118 billion on new oil and gas supplies compared to net income of $55 billion,” the statement said. “We kept investing even during the pandemic, when we lost more than $20 billion and had to borrow more than $30 billion to maintain investment to increase capacity to be ready for post-pandemic demand.”

From canceling the Keystone XL permit to establishing barriers for new pipelines in Appalachia, Biden’s war on domestic energy infrastructure is well documented. Long-term investments in fossil fuel infrastructure are not part of Biden’s energy agenda, yet he expects companies to roll over when he demands it.

Exxon called out Biden’s failures by telling the president what he could do to support domestic energy production. “Longer term, [the] government can promote investment through clear and consistent policy that supports U.S. resource development, such as regular and predictable lease sales, as well as streamlined regulatory approval and support for infrastructure such as pipelines,” recommended Exxon.

Refiners are not holding back supply right now. The utilization rate for refinery capabilities was at a four-week average of 93.4% as of last week. Biden’s letter tries to compare the pre-pandemic energy sector to now, but global refining capacity fell by 730,000 barrels a day in 2021.

“Clear and consistent” are the keywords in Exxon Mobil’s statement because the company is aware of the global decline in refinery capacity. Refiners do not have much room to increase their production because of previously shuttered facilities. Biden targets the profit margins of these corporations, yet he is also close to finding a solution to the problem.

Biden’s letter hints at using executive action to address the refinery crisis. “My administration is prepared to use all reasonable and appropriate Federal Government tools and emergency authorities to increase refinery capacity and output in the near term, and to ensure that every region of this country is appropriately supplied,” Biden said.

The Defense Production Act could be utilized to reopen shuttered refineries, and White House press secretary Karine Jean-Pierre has hinted at this being the path forward. “We’re saying that the president has used it before, and he’s willing to do that again,” she said.

Exxon Mobil’s response also argues that emergency powers could be used to alleviate the burdens facing refiners. “In the short term, the U.S. government could enact measures often used in emergencies following hurricanes or other supply disruptions — such as waivers of Jones Act provisions and some fuel specifications to increase supplies,” their statement said.

If Biden wants to make progress, he needs to cooperate with refiners on reopening these facilities. He has evidently ruled out a long-term solution, but there is still a chance to alleviate short-term pressures the United States and other global oil refiners are facing right now. Decrying corporate profits in letters is virtue signaling to get out of the responsibilities of the office. During a national energy crisis, the public deserves policymaking that solves the problems at hand. Exxon Mobil has told Biden what to do, and now it’s up to him to listen.

James Sweet is a summer 2022 Washington Examiner fellow.


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Tags: Opinion, Beltway Confidential, Gas Prices, Joe Biden, Oil, ExxonMobil

Original Author: James Sweet

Original Location: Exxon Mobil fights back against Biden


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