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Oil Executives Speak About High Gas Prices at House Hearing – The New York Times

Executives of six large oil and gas companies, appearing at a House hearing on Wednesday, defended themselves against criticisms that they were seeking to boost corporate profits by refusing to produce mo…….

Executives of six large oil and gas companies, appearing at a House hearing on Wednesday, defended themselves against criticisms that they were seeking to boost corporate profits by refusing to produce more oil and gas amid Russia’s invasion of Ukraine.

In remarks prepared for the hearing, the executives said they were not engaging in price gouging and were merely responding to global commodity prices that were out of their control. They also said they were working to make the shift to cleaner energy.

The hearing was taking place as lawmakers in Washington fought over who was responsible for rising gasoline prices, and how to balance efforts to limit climate change with the need for more U.S. oil and natural gas production. American and European sanctions over Russia’s invasion of Ukraine have led to limited global supplies.

The average price for a gallon of gasoline is roughly $1.30 higher than it was a year ago, moving up in tandem with oil prices, which are now just above $100 a barrel. That increase has become a major challenge for President Biden and Democrats, who control both houses of Congress. Some Democrats have called on oil executives to suspend dividend increases and stock buybacks and invest more in developing alternative energy and reducing gasoline prices.

Last week, Mr. Biden said some oil companies had increased production but added that “too many companies aren’t doing their part and are choosing to make extraordinary profits and without making additional investment to help with supply.”

The outrage about oil company profits is not unusual. Politicians often criticize the energy industry for profiteering when gas prices surge, and then quietly drop their complaints when prices fall back. Over the last 15 years, oil and gas prices have moved up and down in three big cycles, the most recent one beginning with the coronavirus pandemic.

As vaccines became widely available and the early crush of the pandemic receded, energy demand quickly recovered. But global oil production has not completely returned to prepandemic levels. U.S. production is just shy of 12 million barrels a day, roughly a million short of the record set just before the pandemic. With oil companies adding rigs, the Energy Department expects U.S. production will surpass 13 million barrels next year.

Biden administration officials have urged oil companies to expand production faster, but Wall Street investors are telling them to be more cautious because they don’t want companies to drill up a storm when prices …….

Source: https://www.nytimes.com/2022/04/06/business/energy-environment/gas-prices-executives-congress.html

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