President Biden has warned that oil companies might face increased taxation on excess profits if they don’t focus on increasing oil production. In a speech on Monday Biden said that companies are responsible for reinvesting their profits so that their consumers, community, and country can benefit. He then added that those who fail to act on their responsibilities to the interest of consumers would be made to pay higher taxes on any excess profits. Other restrictions may also be implemented.
Biden would not be able to increase the taxation on oil companies on his own, instead, he would need Congress to pass a law for the increase. Still, he has pledged that he would consider all of the available options and work to create legislation that would deal with this issue.
These comments followed the recent report by ExxonMobil, Chevron, and Shell on their third-quarter earnings. The president referred to both Exxon and Shell in his speech.
Such legislation would be unlikely to pass the filibuster in the Senate since even if Democrats retain all their seats, they would still need 10 GOP votes in favor of the legislation. The GOP is currently hoping that they will be able to win both the House and Senate in the upcoming midterm elections.
Gas prices reached an all-time high after Russia invaded Ukraine, which led to both Western and U.S. sanctions being imposed on the country.
Biden and his administration have frequently said that Russian President Vladimir Putin is to blame for the high gas prices.
However, according to an analyst the war was only one component of why gas prices were so high, as demand also needed to rebound from the pandemic.