Page 8 - NorthAmOil Week 45 2022

NorthAmOil POLICY NorthAmOil

Biden unlikely to change course even

with Republican-led Congress: API

US US President Joe Biden and his administration were major issues during election campaigning.
are unlikely to change course if there is a divided Macchiarola said it is too soon to tell what was
government following the midterm elections on the impact of the Democrats’ campaign talk that
November 8, a senior official at the American the oil industry – with high profits – is to blame
Petroleum Institute (API), an industry group, for high US retail gasoline prices.
has said. The Biden administration has sent mixed sig-
“I do not see the administration changing nals regarding the oil and gas industry, rupturing
their policies – they did not change them when trust even more than during the presidency of
[gasoline] prices were most high,” said the API’s Barack Obama, also a Democrat.
senior vice president of policy, economics and On October 31, Biden had slammed oil com-
regulatory affairs, Frank Macchiarola. He spoke panies for passing on too much of their “outra-
at a post-election webinar convened by Brace- geous” profits to shareholders and executives
well, the law and lobbying firm. instead of reducing the country’s high retail
“We continue to see the government turn gasoline prices. Companies such as ExxonMo-
over – there is a divided electorate,” he said. bil and Chevron reported record profits – or
As of November 10, Republicans were poised near-record profits – in the third quarter of 2022.
to take control of the House with a majority that At the same press conference, Biden had
could stymie Biden’s pro-renewables and climate warned oil companies that their profits could
policy. But control of the Senate remained up in be subject to windfall taxes. “Their profits are
the air – and in fact it may not be known until a a windfall of war – the windfall from the brutal
run-off election in Georgia on December 6. conflict that’s ravaging Ukraine and hurting tens
But importantly, Republicans lawmakers of millions of people around the globe,” he told
would not have the veto-proof two-thirds major- reporters.
ity required in both congressional chambers to Much of the White House response to the
push through legislation against a president issue of high retail gasoline prices has been “sim-
from an opposing party. US presidents can veto ply rhetoric,” Macchiarola told the webinar.
legislation. Biden is a Democrat. He noted that the only substantive action
Since the previous election in 2020, Demo- Biden has taken on the issue is to release oil from
crats have held thin majorities in both chambers. the Strategic Petroleum Reserve (SPR). The most
With much of the outcome of the US mid- recent release was as recently as mid-October
term elections still unknown, the stock market following gasoline prices’ high point of the year
has been jittery. in the early summer.
Democrats did much better than expected Asked if policy responses such as the windfall
in the elections, avoiding the rout that analysts profits tax, or a ban on energy exports, have “run
and pundits had predicted. The November 8 out of gas”, Macchiarola pointed to the array of
Inflation, which midterm election in fact represented the poor- proposals from the Biden administration. On
est performance for a party out of power – the Biden’s first day in office, the API senior vice
is at a 40-year Republicans – in 40 years. president noted that Biden cancelled a key per-
Conventional political wisdom says that mit for the Keystone XL pipeline. Then for exam-
high, and the Americans vote on the basis of cost of living, so ple, earlier this year he pleaded with domestic

cost of living and Democrats were expected to be pummelled at oil and gas industry to raise production as the
the polls. They were not, and it is not yet clear Ukraine war crimped supplies and global energy
gasoline prices why, though the results seem to be a castigation prices rose.
of ex-president Donald Trump and many of the
Macchiarola also said that one advantage of
at the pump were candidates who supported him. a Republican-led Congress could be permitting
“The [election] takeaway is that things reform. “All energy needs infrastructure,” he
major issues are great,” said Macchiarola. “It’s a confusing said.
during election takeaway.” Permitting legislation, including that for
“[The election] was a lost opportunity for the easing development of the Mountain Valley
campaigning. Republicans,” he added. Pipeline for natural gas in West Virginia, was
discussed this summer in the Senate by Joe Man-
Generally, Republicans – and a few conserv-
ative Democrats in states such as Texas – would chin of West Virginia and Senate majority leader
be expected to try to increase oil and gas drill- Chuck Schumer, but was ultimately dropped.
ing, and to roll back Biden’s aggressive climate LNG exports should be boosted too, con-
agenda. Democrats tend to be pro renewable cluded Macchiarola. The API will try to get
energy and climate action. bipartisan support “in the coming year” for
Inflation, which is at a 40-year high, and the increased exports so that trading partners can
cost of living and gasoline prices at the pump reduce carbon emissions, he said.™

P8 www. NEWSBASE .com Week 45 10•November•2022