“Your companies need to work with my Administration to bring forward concrete, near-term solutions that address the crisis,” Joe Biden in an open letter to oil companies. The letter went on to accuse refineries of capitalizing on the war between Russia and Ukraine, gleaning record-high profits while Americans suffer record-high pain at the pump.
President Joe Biden isn’t trying to bring down gas prices. In fact, he’s doing just the opposite. This is pretty rich coming from the guy that vowed to put them out of business.
As a candidate, Biden said, “No more drilling on federal lands. No more drilling including offshore. No ability for the oil industry to continue to drill, period.”
What’s really happening.
But while access to crude has not evaporated as the US intended, refinery capacity continues to lag. This has driven up gasoline prices to higher peaks than crude.
Nor is increasing capacity an easy affair. As Business Insider reported this week:
At the heart of the crisis is the fallout from the pandemic. As COVID rocked the world economy, energy consumption plunged, and many refineries shuttered operations.
Analysts at Wood Mackenzie, an energy consultancy, estimate that 3 million barrels a day of refinery capacity shut down in 2020 and 2021.
And once you shutter a refinery, it can be hard to get it running again.
“You introduce a lot of operational issues that come back to haunt you a few months later,” Claudio G
Shutting down the global economy over a little germ has consequences. We were told it was no big deal. When the US forcibly closed businesses and issued stay-at-home orders, many refineries became unprofitable and closed. Shutting down US oil production, killing the Keystone Pipeline, and then stopping Russian oil imports has created much pain for ordinary citizens.
The usual Democrat response has been to place the blame on imagined “price gouging” or “greedflation.” Of course, the administration has been committed to crippling fossil fuel production for the duration, and now we are all paying the price for that policy.