Biden threatens oil companies with 'emergency powers' if they don't boost supply amid inflation spike

Biden says oil companies are earning 'historically high' profits

President Biden may resort to using emergency powers if American oil companies don't increase output at their refineries, the president told oil CEOs in a series of letters Wednesday.

Biden's statement blames oil companies for running "historically high profit margins" even as Americans experience surging gas prices. Biden has recently faced criticism for a lack of executive action aimed at curbing inflation.

"There is no question that Vladimir Putin is principally responsible for the intense financial pain the American people and their families are bearing," Biden wrote. "But amid a war that has raised gasoline prices more than $1.70 per gallon, historically high refinery profit margins are worsening that pain."

Biden speaks at the Port of Los Angeles

President Biden delivers remarks at the Port of Los Angeles on June 10, 2022. (Mario Tama / Getty Images)

"Your companies and others have an opportunity to take immediate actions to increase the supply of gasoline, diesel and other refined product you are producing," he continued. "My administration is prepared to use all reasonable and appropriate Federal Government tools and emergency authorities to increase refinery capacity and output in the near term, and to ensure that every region of this country is appropriately supplied."

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A California gas station is seen in May

A driver delivers 8,500 gallons of gasoline to an ARCO station in Riverside, California, May 28, 2022. (Damian Dovarganes / AP Newsroom)

Biden sent letters to Marathon Petroleum Corp, Valero Energy Corp, ExxonMobil, Phillips 66, Chevron, BP and Shell.

Ticker Security Last Change Change %
VLO VALERO ENERGY CORP. 101.69 -1.86 -1.80%
MPC MARATHON PETROLEUM CORP. 79.33 -2.38 -2.91%
XOM EXXON MOBIL CORP. 83.28 -1.53 -1.80%
PSX PHILLIPS 66 79.52 -0.86 -1.08%
CVX CHEVRON CORP. 140.75 -1.81 -1.27%
BP BP PLC 26.73 -0.42 -1.57%
SHEL SHELL PLC 48.01 -0.59 -1.21%

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The letters represent Biden's latest attempt to use executive action to curb inflationary pressure. Inflation currently sits at a 40-year high of 8.6% and shows no signs of slowing down.

The letters come one day after Biden ordered the sale of another 45 million barrels of crude oil from the U.S. Strategic Oil Reserve.

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Biden's letter does not offer a timeline for when his administration would resort to emergency powers, threatening only to do so in the "near term."

The oil companies have yet to publish a response to Biden's letter Wednesday.