Biden tells oil companies in letter 'well above normal' refinery profit margins are 'not acceptable'
Oil prices fell after Biden’s letter was released, with West Texas Intermediate, the U.S. benchmark, recently trading down more than 1% at $117.71.
The president’s letter was also addressed to global giants $BP PLC(BP.US$ and $Shell(SHEL.US$ , as well as refiners $Marathon Petroleum(MPC.US$ , $Valero Energy(VLO.US$ and $Phillips Edison(PECO.US$ Shares of $Exxon Mobil(XOM.US$ , $Chevron(CVX.US$ and the refiners were all down slightly in premarket trading.
My Thoughts: Not at all trying to defend the profits oil companies are making, but why in God's name would they take on any projects to increase refinement capacity when in the exact same breath, world governments are telling automakers that they need to be nearly/all electrified within the next decade? There is absolutely zero incentive for any of the oil companies to hike up gasoline production when they know they won't make their money back making consumer gasoline. The major governments of the planet need to give them some reason to increase refining (whether by threat, or by tax benefits) otherwise this situation will not fix itself. Every single player on the selling side of oil is benefitting massively right now.![]()
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