The energy industry is pushing back after President Joe Biden suggested that the skyrocketing cost of gasoline and other energy sources could be foul play by producers.
Biden sent a letter to Lina Kahn, chair of the Federal Trade Commission, asking her to investigate alleged “anti-consumer behavior” from oil and gas companies.
“I do not accept hard-working Americans paying more for gas because of anti-competitive or otherwise potentially illegal conduct,” Biden said.
The letter argues that profits have continued to rise for the companies along with the prices.
“I therefore ask that the Commission further examine what is happening with oil and gas markets, and that you bring all of the Commission’s tools to bear if you uncover any wrongdoing,” the letter reads.
Biden’s critics point to his increased energy regulation, shutting down the Keystone Pipeline and for months banning new drilling leases on federal lands. They also blame increased federal spending under the Biden administration, which has significantly increased inflation and, as a result, consumer prices for a range of goods and services.
The American Petroleum Institute said “ill-advised government decisions” are the main cause of the rising costs.
“This is a distraction from the fundamental market shift that is taking place and the ill-advised government decisions that are exacerbating this challenging situation,” said API’s Senior Vice President for Policy, Economics and Regulatory Affairs, Frank Macchiarola.
“Demand has returned as the economy comes back and is outpacing supply. Further impacting the imbalance is the continued decision from the administration to restrict access to America’s energy supply and cancel important infrastructure projects. Rather than launching investigations on markets that are regulated and closely monitored on a daily basis or pleading with OPEC to increase supply, we should be encouraging the safe and responsible development of American-made oil and natural gas.”
The American Automobile Association’s gas prices tracker shows the national average of a gallon of regular gasoline is about $3.41, which is $1.20 more expensive than the same time last year.
The Bureau of Labor Statistics released data earlier this month showing a sharp increase in the cost of all kinds of energy in the past year, including natural gas and electricity.
“The energy index rose 4.8 percent in October after rising 1.3 percent in September,” BLS said. “The gasoline index rose 6.1 percent in October, its fifth consecutive monthly increase. The index for natural gas rose 6.6 percent over the month, its largest monthly increase since March 2014. The electricity index increased 1.8 percent in October, its largest 1-month increase since May 2014, while the fuel oil index also rose sharply, increasing 12.3 percent.”
The entire energy index has increased 30% in the previous 12 months ending in October, the biggest increase of its kind in over a decade.
“All the major energy component indexes increased sharply over the last 12 months,” BLS said. “The gasoline index rose 49.6 percent over the last year, and is now at its highest level since September 2014. The fuel oil index increased sharply over the year, rising 59.1 percent. The index for natural gas rose 28.1 percent over the last 12 months, and the electricity index rose 6.5 percent.”
Republicans have pointed to these increases, laying them at the feet of the Biden administration. The costs became an issue in Virginia’s elections earlier this month, when Republicans were able to secure major victories including reclaiming the governor’s office and the state House.
“Joe Biden canceled the Keystone pipeline,” U.S. Sen. Tom Cotton, R-Ark., said. “He banned drilling on federal land. He put anti-energy extremists in his cabinet. Now he blames energy companies for the high price of gas? He’s delusional.”
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