Because Biden makes Exxon and the other American Big Oils howl with joy
Biden has done more things for American Big Oil (Exxon in particular) than a pro-fossil Republican like Trump. Here because. The Wall Street Journal article
Notice the irony of fate. President Biden has done more to enrich Big Oil and their shareholders than Donald Trump or any other incumbent in the White House in decades. His administration's crusade to limit US oil and gas production is yielding record profits for Exxon Mobil and other fossil fuel giants.
Exxon reported a record annual profit of $55.7 billion on Tuesday, surpassing $45 billion in 2008. That makes Exxon one of the most profitable companies in American history. A truly extraordinary change of fortune. Two years ago, Exxon and other oil companies were losing money as prices collapsed at the onset of the pandemic. Opponents of fossil fuels celebrated.
But as economies recover, so has the demand for oil. Long-distance trucks and planes cannot run on solar power or batteries. Some members of the Organization of the Petroleum Exporting Countries have reduced investments during the pandemic because they did not expect such a rapid recovery in demand.
At the same time, giants like BP and Shell have channeled more capital into renewable energy. As prices began to rise in 2021, US producers faced pressure from investors to limit investment in new production because no one knew how long the good period would last, especially amid the political assault on fossil fuels and proclamations that the death of oil was nearby.
Exxon defied the crowd and thus profited tremendously from last year's high oil prices. “We stepped in when others balked, contradicting conventional wisdom,” Chief Executive Officer Darren Woods said Tuesday. Not that other giants aren't enjoying healthy gains, too. Chevron last week announced record annual earnings of $36.5 billion and a $75 billion share repurchase program.
Chevron's announcement elicited an angry and defensive response from the White House. The only thing stopping the companies from ramping up production "is their own decision to continue to pour windfall profits into the pockets of executives and shareholders instead of using them to boost supply," a White House spokesman said.
But the big oil companies, or Big Oil, do nothing but benefit from the supply shortages and production constraints that the Administration has helped create. US production remains about 900,000 bpd below its pre-pandemic peak, double the decline in Russian oil exports following the invasion of Ukraine. “As an industry, we are underinvesting in this area,” Woods explained accurately.
Why, pray tell, this? One reason is that the Administration and European governments have told companies that their products will soon become obsolete. Another reason is the Administration's barrage of regulations against the industry. It has delayed the sale of leases, dragged pipeline clearance times and tightened mandates for renewable fuels that drive up costs for refiners.
As an example, consider guidance proposed by the White House this month, which would require federal agencies to calculate indirect greenhouse gas emissions for fossil fuel projects, including new oil and gas leases. Agencies should also analyze potential renewable alternatives, which would make it easier to stall projects.
Renewable projects would be exempt from this onerous GHG emissions analysis even if the solar panels are produced in China using coal power. Big oil companies will survive the regulatory onslaught and could benefit financially if smaller rivals go bankrupt and if prices continue to rise as Chinese demand increases as the Covid-zero ends. Who will pay for these Biden policies are American consumers.
– Read also: Has Biden done worse than Trump on solar energy?
(Excerpt from the press release of eprcommunication)
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/energia/joe-biden-profitti-big-oil/ on Sun, 05 Feb 2023 06:47:06 +0000.