Biden, not ‘big oil’, is to blame for spikes in energy prices – OpEd – Eurasia Review

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The President calls for an investigation into the price of gas reads a front-page headline in the Wall Street Journal on Nov. 18. President Biden apparently wants Americans to believe that major producers and distributors of fossil fuels (Big Oil) are responsible for recent increases in prices at the pump and the looming shock of stickers on home heating bills.

As President Reagan might have said, here he is again. Seeking to shirk responsibility for his own political actions, Biden asked Federal Trade Commission Chairman Lina Kahn, named for her relentless hostility to Big Tech, to launch an investigation into whether U.S. energy companies have conspired. or engaged in other illegal behavior to profit from consumer spending on gasoline, diesel fuel and heating oil.

We’ve seen the same headlines before. Whenever energy prices rise sharply during the OPEC oil embargoes of the 1970s, wars in the Middle East, and hurricanes on the Gulf or the East Coast that disrupt drilling, refining or gasoline operations. industry distribution, the White House or Congress react predictably by pointing the finger at Big Oil, asking for reasons other than the normal functioning of global energy markets.

Over time, the FTC has subpoenaed and amassed hundreds of thousands of documents from major oil and gas companies, by no means cheap to taxpayers or the corporations themselves. These investigations never produced any evidence of anti-competitive behavior justifying further legal action.

This time around, the Biden administration thinks something bad must be happening due to an unexplained gap in the price of unfinished gasoline (before blending with ethanol and other additives) and prices at the pump, which rose three percent in one month. . But, as any consumer knows, all prices have risen recently (by more than six percent per year) as the economy struggles to absorb large expansions in the money supply, lavish federal spending, and keep up. in the face of supply-side bottlenecks caused by lockdowns and other counterproductive policies of the Sars-Cov-2 pandemic. Energy is the most volatile component of consumer price indices.

The unexplained gap, which varies depending on the supply and demand for gasoline and ethanol, is no mystery. Washington’s mandate on ethanol or the renewable fuels standard (meant to buy votes for cornbelt states) is largely responsible for this.

If he wants to explain why energy prices have snowballed, President Biden should look in the mirror. Since taking office, he has canceled the XL pipeline, which would have reduced the cost of transporting crude from shale oil fields in Canada and the Dakotas to refineries on the Gulf Coast, banning all exploration and drilling. additional federal lands and canceled offshore oil leases. The president’s unsuccessful attempt to ease the pain of his green energy policies by encouraging OPEC to increase production is laughable.

The same goes for his announcement a few days later (joined by other Western leaders) that crude oil will be released from national stocks of so-called strategic oil reserves. If this action is taken, the effects on the price of fuel will only be transitory.

It is appropriate to shift the blame onto monopoly or market power for the economic effects that undermine the re-election hopes of politicians. Fat is bad after all, isn’t it? However, the first place to look for the culprits to explain increases in the price of energy or any other good or service should be in government.

As Edmund Burke once wrote, The Thing In Itself Is Abuse!

This article was published by The Beacon

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