Putin, OPEC, Big Oil: Biden’s against those responsible for gas prices

Politics

(The Hill) — President Joe Biden and the White House are taking on big oil companies, the Organization of the Petroleum Exporting Countries (OPEC), Russia and anyone else who might be to blame for high gas prices in the U.S.

With midterm elections fast approaching, rising gas prices pose a major threat to Democratic efforts to hold onto majorities in the House and Senate, and Biden and his team have repeatedly argued outside influences are to blame for the increases — a sentiment they revisited Wednesday on an issue that has stubbornly plagued the White House and Democrats for much of this year.

As Hurricane Ian slammed into Florida last week, Biden’s focus was squarely on big oil companies, warning them not to use the storm to raise prices for customers.

But on Wednesday, OPEC became the center of his ire when its oil-exporting allies announced plans to slash oil production by 2 million barrels per day, which the president and his top aides ripped as “shortsighted.”

Underlying it all has been a consistent effort to place the blame for high gas prices on Russian President Vladimir Putin, whose invasion of Ukraine rattled global markets and has had a particularly concentrated effect on energy supply since Russia is one of the top exporters in the world.

Each of the lines of criticism was on display on Wednesday as the OPEC+ decision sparked worry among Democrats about a potential ripple effect with just one month until the midterm elections.

“It’s clear that OPEC+ is aligning with Russia with today’s announcement. We’re dealing with a time where … the global economy is responding to Putin’s war. So by making this decision, it is going to have an effect on low- and middle-economic income countries,” White House press secretary Karine Jean-Pierre told reporters.

Exxon Mobil this week signaled strong earnings in the third quarter after it hit an all-time high in earnings last quarter. The White House stressed that oil producers need to close the gap between wholesale and retail prices in order for customers to see lower prices at the pump.

“These companies need to focus on passing through savings to their customers. The gap between wholesale and retail price of gasoline is too wide, energy companies need to bring down their retail price,” Jean-Pierre said on Wednesday.

Asked about steps the White House will take to keep gas prices from spiking, Jean-Pierre pointed to calls for refiners to quickly come back online and for U.S. energy companies to keep bringing prices down.

Last week, with Hurricane Ian bearing down on Florida, Biden pleaded with gas companies not to raise their prices.

“I also want to say again to the oil and gas executives: Do not, do not, do not use this storm as an excuse to raise gasoline prices or gouge the American public,” Biden said last week, noting that the price of oil had dropped in recent weeks.

“If gas station companies try to use this storm to raise prices, I’m going to ask … officials to look into whether or not price gouging is going on,” he added. “America is watching, and the industry should do the right thing. And I expect them to do the right thing.”

The president had also made a concerted effort to avoid decreased production by OPEC+, traveling to Saudi Arabia in July to directly appeal to its leaders to increase oil production, despite his administration’s frequent criticism of the kingdom’s human rights record.

The White House again reached out to OPEC+ members ahead of Wednesday’s announcement to lobby the coalition against production cuts at a time when the global economy is teetering and prices have been rising.

“We are always in touch with partners, both producers and consumers,” Jean-Pierre said. “It’s no secret that the president believes energy supply should meet energy demand, and it is important for the global economy as it faces global challenges.”

Alex McDonough, who was co-chair for Clean Energy for Biden during the 2020 presidential campaign and is now a partner at Pioneer Public Affairs, said the global energy issues caused in part by the Russia-Ukraine war, are proving to be a prime opportunity to pivot to clean energy domestically — and consider it a national emergency.

“President Biden inherited a world in which OPEC+, including Russia, sets oil prices, and the U.S. can’t drill enough to make that untrue,” McDonough said.

It was just a few weeks ago when White House chief of staff Ron Klain and others were highlighting daily declines in prices at the pump as the cost dipped to close to $3 per gallon in mid-September in parts of the country.

But prices have started to tick up once again, with AAA reporting an average price per gallon of $3.83 nationally, up from an average of $3.76 one week ago.

The OPEC+ decision, paired with existing concern about gas prices, has provided an opening for Republicans to go on the attack and blame Biden for increased costs with a particular focus on his energy policies.

“The Biden administration is treating an expected OPEC+ cut of foreign oil production as a ‘total disaster’ and ‘hostile act’ and working hard to stop it—yet, cutting domestic production has been their explicit goal in federal areas here at home,” tweeted Sen. Lisa Murkowski, R-Alaska, a moderate Republican up for reelection next month.

Jean-Pierre, asked Tuesday about Biden taking credit for gas prices coming down and whether he should shoulder some blame for prices going up, called the situation “nuanced,” pointing to the pandemic and the war in Ukraine as reasons for uncertainty.

“There have been global challenges that we all have dealt with,” Jean-Pierre said. “When I say ‘all,’ meaning other countries as well have dealt with since the pandemic. There’s been pandemic and there’s been Putin’s war. And Putin’s war has increased gas prices at the pump. We have seen that over the past several months.”

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