Oil company executives called to hearing on gas price increases

'The oil industry may be exploiting the war in Ukraine for its own economic gain,' chairman says

Gas prices are displayed outside an Exxon station in Washington on March 8. (Bill Clark/CQ Roll Call)
Gas prices are displayed outside an Exxon station in Washington on March 8. (Bill Clark/CQ Roll Call)
Posted March 18, 2022 at 7:00am

The top executives of six oil companies have been called to appear at an April hearing of the House Energy and Commerce Committee in connection with elevated gasoline prices following Russia’s invasion of Ukraine.

In letters sent Wednesday, Frank Pallone Jr., D-N.J., chairman of the committee, requested executives of six companies appear April 6 to answer questions about the war in Europe, their revenue, fuel prices, stock buybacks, domestic oil production and other corporate activities.

“I am concerned that the oil industry may be exploiting the war in Ukraine for its own economic gain,” Pallone said in the letters.

“Oil companies are currently seeing record profits,” he said. “As Americans reemerged from the coronavirus … lockdowns and demand for gasoline increased, oil companies kept supply low and prices high.”

Pallone’s letters follow comments Wednesday by Senate Majority Leader Charles E. Schumer accusing large oil and gas companies of possibly “price gouging,” noting that gasoline prices have remained high in recent days after crude oil prices dropped. Schumer also called for major oil company executives to be summoned for testimony to Congress.

There is interest among several Senate committees to also host hearings, according to a Senate Democratic staffer, who said Thursday that multiple committees have jurisdiction.

Talk of gasoline prices has dominated Congress and Washington after Russia’s attack, with President Joe Biden sanctioning U.S. imports of Russian fossil fuel supplies, Democrats pushing to suspend the federal gas tax and Republicans and centrist Democrats calling for more domestic oil and gas drilling.

The companies Pallone called are BP, Chevron, Devon Energy, Exxon Mobil, Pioneer Natural Resources and Shell. A BP spokesman said the company is reviewing the request. The others did not immediately respond to requests for comment.

Oil prices hit more than $130 a barrel in early March and gas prices in the U.S. rose too, hitting about $4.33 per gallon on average on March 11, according to AAA, the automobile club.

Oil prices have since fallen, though prices were climbing again Thursday. Brent, the international oil benchmark, opened at less than $100 a barrel on Thursday morning and was trading at more than $106 by noon, while the American benchmark was trading at over $102 per barrel, up $7 from Wednesday’s price. Gas prices have fallen to a national average of $4.289 on Thursday, drown from $4.305 on Wednesday, according to AAA.

Industry experts say there can be a lag of days or weeks between the prices of crude oil trading on a worldwide market and the costs drivers pay for refueling.

Schumer said Wednesday the Senate would also investigate “the bewildering incongruity between falling oil prices and rising gas prices” — something he said “smacks of price gouging.” Schumer did not say which committee would hold such a hearing.