(Bloomberg) – President Joe Biden has criticized the energy company’s record profits after Shell Plc posted its second-highest earnings ever while raising its dividend and expanding buybacks.
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“That’s more than double what they did in the third quarter of last year, and they also raised their dividend, so the profits go back to their shareholders instead of going to pump and lower the price,” Biden said. at an event in Syracuse, New York.
Biden has repeatedly asked oil companies to forego buybacks and increase dividends, and urged them to reduce the price of gas pumps for American motorists instead of returning profits to shareholders.
Energy companies need to “reduce the cost of a gallon of gas to reflect the cost they pay for a barrel of oil,” he said.
Biden’s comments were quickly criticized by oil industry leaders.
“Refiners do not set the price consumers pay at the pump or the price of crude oil,” and are operating “their facilities in a safe and responsible manner to maximize gasoline supply.” , diesel and jet fuel for Americans and economies around the world’s needs,” said Chet Thompson, president of the American Association of Fuel and Petrochemical Manufacturers.
And the American Petroleum Institute thinks the president’s focus is misplaced.
“With energy costs and geopolitical uncertainty around the world continuing to increase, it is time for Washington to focus on leveraging U.S. energy production in the face of nonconformity,” the trade group said. The global mix of energy demand and available supply drives fuel prices higher.” statement sent via email.
A Shell spokesman did not immediately respond to Biden’s comments.
A gallon of gas cost an average of $3.76 on Wednesday, according to motor club AAA. Shares in Shell jumped more than 5% on Thursday, to 2,425 pence in London.
Analysts and energy officials say there is generally a disparity between changes in crude oil and gasoline prices, in part due to the cost of the time it takes to filter through the supply chain.
High oil prices are proving a hardship for multinational energy companies. Exxon Mobil Corp. is expected tomorrow to post the second-highest quarterly profit in the company’s 152-year history.
Democrats, who face difficulties in the November 8 midterm congressional elections in part because of inflation and high gasoline prices, have made oil companies profitable.
“$9.5 billion is a lot of money,” Connecticut Senator Chris Murphy said in a tweet. “We don’t have to put up with this. But if you elect Republicans in two weeks, they’ll do the bidding on these people.”
However, Democrats’ proposals to impose a so-called profit tax on energy companies have repeatedly failed, even as the party controls both houses of Congress.
On Thursday, Shell said it would buy back another $4 billion of shares over the next three months, bringing its total repurchases for the year to $18.5 billion. It plans to increase its dividend by 15% for the fourth quarter, subject to board approval.
Shell reported a record second-quarter profit of $11.47 billion, as oil prices surpassed $100 a barrel. Benchmark Brent crude closed at $97 on Thursday, up $1.27.
Several of Shell’s peers also reported outstanding financial results on Thursday. TotalEnergies SE revealed record profits, and Repsol SA said it will pay a higher dividend than previously announced.
–With support from William Mathis.
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