Madam President, soaring fuel prices are impacting every corner of the globe and hitting the pocketbooks of American families and businesses. Today, a gallon of gas costs $4.52--nearly $1.50 more than a year ago. From food to clothing to…
Madam President, soaring fuel prices are impacting every corner of the globe and hitting the pocketbooks of American families and businesses. Today, a gallon of gas costs $4.52--nearly $1.50 more than a year ago. From food to clothing to rent, growing transportation expenses are pushing already rising prices even higher.
Yet, while the American people are taking a hit, while the local mom- and-pop stores pay more for energy and goods, big oil companies are announcing giant profits. They have hit the jackpot.
Over the first 3 months of the year, ExxonMobil reported $5.5 billion in profits, Chevron recorded $6.3 billion, and Shell raked in $9.1 billion--its largest quarterly profit ever. In just 3 months, these three companies made nearly $21 billion in profits.
Now, robust profits are usually a signal for companies to invest in capital and labor and build the foundation for future growth, but Big Oil has different priorities. Rather than increasing business investment or production, these companies have almost uniformly pumped profits directly to their executives and wealthy shareholders.
In February, even before the Russian invasion of Ukraine sent gas prices skyrocketing, the Financial Times reported that seven of the largest oil companies--including Exxon, Chevron, BP, and Shell--were expected to return $38 billion to shareholders through buybacks this year, plus another $50 billion in dividends. Big Oil hasn't hidden its strategy: Hold back production, and rake in the profits.
In a March 2022 survey, the Federal Reserve Bank of Dallas asked oil executives for the primary reason that publicly traded oil companies were restraining production despite high oil prices. The No. 1 answer they gave, reflecting the view of nearly 60 percent of those surveyed, was that it was ``investor pressure to maintain capital discipline.'' To put it another way, they were saying that they don't want to produce more oil because more production will hasten the end of high oil prices and exorbitant investor profits.
Some oil company executives have been even clearer. Just last month, Chevron's chief financial officer confirmed that the company's top priority is its dividends, not investing in its business, and BP's CFO made similar comments during his company's first quarter earnings call--so much for BP's advertising campaign that it is investing in green energy.
Instead of resuming the production they cut in 2020, oil companies have kept output constrained, turning a 50-percent increase in prices at the pump over the past year into record-setting profits.
Make no mistake, our domestic producers have the capacity to produce more. Indeed, domestic crude oil output is below 2019 levels--that is right, domestic crude oil output is below 2019 levels--and over 12 million acres of leased Federal lands remain untapped.
My Republican colleagues are quick to try to weakly blame President Biden and ``regulation'' for lagging production, but that is not what the oil executives say. Look back at that Dallas Fed survey I mentioned earlier. Only 6 percent of the oil executives surveyed said that ``government regulation'' was the reason they weren't producing more. Sixty percent said it was higher profits. Six percent said it was regulation.
Now, I understand private companies are going to pursue high profits. That is business, that is free enterprise, and that is a competitive market. But when Putin and OPEC have outsized influence on the market, can we really call it a competitive market?
Look, the major oil companies can't control what Putin or OPEC does, but there is no doubt that Putin's war is taking their profits into the stratosphere.
And oil companies clearly think this is a great time for more dividends and more buybacks, not more production, lower prices, and giving the American people a break. In fact, just last month, Exxon announced it would triple its stock buybacks this year and next to $30 billion. Thirty billion dollars is an astonishing number.
One of the things about buybacks is that they essentially raise the price of the company's stock. If you are an executive whose major compensation is stock options, you are giving yourself a huge raise, and that is part of this too. It is self-aggrandizement. It is something that does not square, I think, with the feelings of the American people and also the needs of the American people.
It is clear that the oil companies are not interested in helping Americans on their own, so the Federal Government needs to step in. We need responsible solutions that bring down prices and help families pay for the basics.
We must use every tool at our disposal. I fully support the President's pledge to release a million barrels of oil per day from the Strategic Petroleum Reserve to help stabilize volatile prices. One can imagine the price at the pump if the President was not doing this. It would be even further in excess of what is, I think, appropriate.
I have introduced the Food and Fuel Family Savings Act, which would provide most households with $600 per person, specifically to cover higher gas and grocery costs this year. My bill would be fully paid for, targeted to those families making under $80,000, and would also ease medium- and long-term inflation by crafting a fairer tax code. Instead of waiting for inflation to disappear, it would provide immediate and real help to Americans.
I have also joined my colleague Senator Whitehouse in introducing legislation to return some of those windfall profits that oil companies are handing out as dividends and buybacks back to consumers.
These are important short-term efforts that will help Americans struggling with higher costs. But to truly lower costs in the long term, we must make the transition to clean energy and break our reliance on Big Oil and hostile foreign actors. I am proud that in Rhode Island, we are leading the way on offshore wind, a good renewable resource that when deployed will lower costs for consumers.
The bipartisan infrastructure law is also making key investments to advance this transition, including over $60 billion primarily for new major clean energy demonstration and deployment programs.
The President has been calling for additional funding to enable this clean energy future. We need a package that includes tax credits and grants that would make clean energy, clean vehicles, and other clean technologies more affordable and competitive.
If we do these things, we will make ourselves less vulnerable to the whims of oil companies and cartels that depend on Americans paying more than they should. We will make our world cleaner, lower costs, and finally achieve the energy independence that we have wanted all along.
One of the many lessons of the past 2 years is that we cannot rely on oil for
plentiful, affordable energy. It is clear that allowing our energy needs to be held hostage by leaders like Vladimir Putin and organizations like OPEC is dangerous, but placing our faith in Big Oil is equally foolhardy given their preoccupation with profits over people.
As we battle inflation, it is the American people, not executives and wealthy shareholders, who should be the focal point of our energy and economic policy.
I urge all of my colleagues to join me in supporting policies that will help families now and in the future.
I yield the floor.
I suggest the absence of a quorum.