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Oil executives on Capitol Hill defended their companies as Democratic lawmakers launched accusations of price gauging at the pump during a hearing hosted by the House Committee on Energy & Commerce yesterday.
Democrats pointed the finger at big multinationals for not pumping enough crude and keeping supplies tight while reaping record profits. The oil industry in turn blamed the Biden Administration for clamping down on exploration and permits.
“The truth is somewhere in the middle,” OPIS Global Head of Energy Analysis Tom Kloza told Yahoo Finance Live.
“The incumbent President Biden was blamed for the prices at the pump now. Which is completely disingenuous,” said the analyst.
“If you really want to, go back to when OPEC+ was formed, and it was a cartel then. The cartel added Russia to it,” said Kloza. “It’s very, very unfair to blame President Biden for this.”
Oil executives told lawmakers on Wednesday that their companies are producing more and that prices are set by the market, not by them.
“I think if you research some of the salaries and some of the people who are in oil and gas [industry], they haven’t suffered like the middle class or some of the people at the margins. It’s kind of annoying to watch this,” said the analyst.
“And it was annoying, equally, to watch the claims of price gauging when in reality it is the market that delivers the prices,” added Kloza.
Devon Energy (DVN) President and CEO Rick Muncrief told lawmakers his company finds and produces oil. “We do not refine or sell refined products,” he said.
Gretchen Watkins, president of Shell USA (SHEL), echoed a similar point. “Nearly all Shell-branded retail gas stations are owned by independent operators who set their own prices in the marketplace.”
Ines is a markets reporter for Yahoo Finance. Follow her on Twitter at @ines_ferre
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