President Biden simply accused oil corporations of ‘conflict profiteering’ and threatened them with a windfall tax. Will it assist with fuel costs?

Within the wake of scorching inflation and Russia’s conflict in Ukraine, main fuel corporations like Chevron and Exxon Mobil are raking in earnings. And it’s bought President Joe Biden sizzling beneath the collar.

“Document earnings at present will not be as a result of they’re doing one thing new or progressive. The earnings are a windfall of conflict,” Biden mentioned in remarks on the White Home on Monday, accompanied by Treasury Secretary Janet Yellen and Power Secretary Jennifer Granholm.

With fuel costs nonetheless elevated, and an costly winter forward, Biden says he’s able to drive these oil corporations to behave — however whereas his phrases for these corporations could also be sturdy, he could not have the ability to again them up.

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Biden doesn’t mince his phrases

Biden has been waging a battle with oil corporations over the previous few weeks, however he escalated it Monday when he known as on them to “act past their slender self-interest,” to “spend money on America by rising manufacturing and refining capability” on behalf of “their customers, their group and their nation.”

And in the event that they don’t? Biden warns they’re going to face “a better tax on their extra earnings and … increased restrictions.”

The president didn’t elaborate on what these restrictions could be, however promised his administration would work with Congress to guage all of the accessible choices.

“It’s time for these corporations to cease conflict profiteering, meet their tasks on this nation and provides the American folks a break,” Biden added.

Oil corporations fireplace again

Whereas fuel has dropped from a report excessive of over $5/gallon in June, it’s nonetheless presently hovering round $3.76. And that, together with a dangerously low oil provide and a dwindling diesel stockpile is clearly weighing on Biden.

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However oil corporations argue they’re already contributing to the trigger. Exxon Mobil’s CEO Darren Woods took a second in the course of the firm’s third-quarter earnings name on Oct. 28 to handle Biden. “There was dialogue within the U.S. about our trade returning a few of our earnings on to the American folks,” Woods mentioned. “That’s precisely what we’re doing within the type of our quarterly dividend.

The president didn’t take kindly to that, tweeting his response a couple of hours later: “Can’t imagine I’ve to say this however giving earnings to shareholders is just not the identical as bringing costs down for American households.”

Any taxes would face an uphill battle

Biden seems to be proposing a “windfall” tax to redistribute earnings to American customers nonetheless paying out the nostril on the pump. And with the hotly anticipated midterm elections only a week away, little question he expects it to be a preferred proposal.

However even with Biden’s backing, there’s no assure he’ll be capable of cross a brand new company tax. For that, he’d want help from Congress and with a Senate divided in half between Republicans and Democrats, that appears unlikely. And with Republicans anticipated to doubtlessly take the bulk within the Home in subsequent week’s elections, it looks like a good longer shot.

Nonetheless, the president isn’t ready to again down but. Final Friday, Exxon and Chevron, two of the nation’s largest oil corporations, reported hefty earnings for the fourth consecutive quarter. That very same day, in a briefing from the White Home, Biden identified that six of the most important corporations “made $70 billion in revenue” in simply 90 days.

Appalled that every one that cash was going again to their shareholders and executives, Biden issued a promise: “I’m going to maintain harping on it. [These companies] speak about me selecting on them, they ain’t seen nothing but. I imply it. It outrages me.”

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