The American Petroleum Institute (API) and ExxonMobil Corporation have both responded to a recent letter sent by U.S. President Joe Biden to oil refineries.
“While we appreciate the opportunity to open increased dialogue with the White House, the administration’s misguided policy agenda shifting away from domestic oil and natural gas has compounded inflationary pressures and added headwinds to companies’ daily efforts to meet growing energy needs while reducing emissions,” API President and CEO Mike Sommers said in the API’s response.
“I reinforced in a letter to President Biden and his Cabinet yesterday [June 14] ten meaningful policy actions to ultimately alleviate pain at the pump and strengthen national security, including approving critical energy infrastructure, increasing access to capital, holding energy lease sales, among other urgent priorities,” he added in the response.
“Ahead of his travel to the Middle East next month, we urge the President to prioritize unlocking U.S. energy resources – that are the envy of the world – instead of increasing reliance on foreign sources,” Sommer continued.
In its response, ExxonMobil noted that it has been in regular contact with the administration to update the President and his staff on how ExxonMobil has been investing more than any other company to develop U.S. oil and gas supplies.
“This includes investments in the U.S. of more than $50 billion over the past five years, resulting in an almost 50 percent increase in our U.S. production of oil during this period,” ExxonMobil said in a statement posted on its website.
“Globally, we’ve invested double what we’ve earned over the past five years — $118 billion on new oil and gas supplies compared to net income of $55 billion. This is a reflection of the company’s long-term growth strategy, and our commitment to continuously invest to meet society’s demand for our products,” the company added in the statement.
“Specific to refining capacity in the U.S., we’ve been investing through the downturn to increase refining capacity to process U.S. light crude by about 250,000 barrels per day – the equivalent of adding a new medium-sized refinery. We kept investing even during the pandemic, when we lost more than $20 billion and had to borrow more than $30 billion to maintain investment to increase capacity to be ready for post-pandemic demand,” ExxonMobil continued.
In the short term, the U.S. government could enact measures often used in emergencies following hurricanes or other supply disruptions — such as waivers of Jones Act provisions and some fuel specifications to increase supplies, ExxonMobil noted in its response.
“Longer term, government can promote investment through clear and consistent policy that supports U.S. resource development, such as regular and predictable lease sales, as well as streamlined regulatory approval and support for infrastructure such as pipelines,” ExxonMobil added.
In his letter, Biden told U.S. oil refiners that unprecedented profit margins are unacceptable and called for “immediate action” to improve capacity, Bloomberg outlined. Biden said his administration was prepared to take any “reasonable and appropriate” steps that would help companies increase output in the near term, Bloomberg reported.
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