Biden hits out at Big Oil’s record profits as White House fails to tame inflation
US President Joe Biden called on ExxonMobil (Exxon) to drill for more oil and pay higher taxes in a stunning broadside on the US oil industry, accusing the sector of capitalising on supply shortages to fatten profits.
He accused Exxon of “making more money than God this year.”
Biden told reporters at the Port of Los Angeles: “Why aren’t they drilling? Because they make more money not producing more oil. Exxon, start investing and start paying your taxes.”
This follows fresh, gloomy reports from the US Labor Department that consumer prices have climbed 8.6 per cent in May from a year ago – the highest rate of inflation in 40 years.
According to motoring group AAA, petrol prices have also topped five dollars a gallon for the first time ever.
The rising prices have been powered booming oil markets, which peaked at 14-year highs in March following Russia’s invasion of Ukraine.
Prices remain elevated on both major benchmarks at over $120 per barrel.
The White House is desperate to driven down inflation ahead of the mid-terms in November to ease the cost of living, amid fears the Republican Party could take control of both the Senate and House of Representatives.
Biden has already tried several measures to lower prices such as record release of barrels from US strategic reserves, waivers on rules related to the production of summer gasoline, and leaning on major OPEC countries to boost output.
However, the outbreak of war in Ukraine and recovering demand from two-years of disruption driven by the pandemic has kept commodity prices elevated.
Exxon, the largest US oil producer, posted its biggest quarterly profit in seven years in February and has pledged to spend up to $30bn through next year.
The energy giant suffered losses of $20bn in 2020, and had borrowed more than $30 billion to finance operations.
It paid $40.6 billion in taxes last year, $17.8 billion more than in 2020.