March 10, 2022
As Gas Prices Rise, Warren, Whitehouse, Khanna, Colleagues Introduce Bill to Stop Big Oil Profiteering and Provide Consumers Relief
Big Oil Windfall Profits Tax
Prevents Oil Companies from Taking Advantage of Global Conflicts to Jack Up
Prices and Line Their Pockets
Washington, D.C. – U.S. Senator Elizabeth Warren (D-Mass.),
a member of the Senate Finance Committee, Senator Sheldon Whitehouse (D-R.I.),
and ten other Senate colleagues introduced the Big Oil Windfall Profits Tax to
curb profiteering by big oil companies and provide Americans consumers relief
at the pump. Representative Ro Khanna (D-Calif.) will introduce the legislation
in the House of Representatives. The legislation would levy a per-barrel-tax on
big oil companies' pandemic profiteering prices and return the revenue to
consumers as a quarterly rebate.
“While Putin's war is causing gas prices to go up, Big Oil companies are
raking in record profits. We need to curb profiteering by Big Oil and provide
relief to Americans at the gas pump — that starts with ensuring these
corporations pay a price when they price gouge, and using the revenue to help
American families,” said Senator Warren.
“While the U.S. severs economic ties with Putin to protect our national
security, I am committed to doing everything in my power to limit the fallout
for Rhode Islanders who were already getting squeezed before this happened,” said
Senator Whitehouse. “We’ve seen this script before, and we cannot
allow the fossil fuel industry to once again collect a massive windfall by
taking advantage of an international crisis. I propose sending Big Oil’s big
windfall back to the hardworking people who paid for it at the gas pump. Over
the longer term, speeding up the transition to renewables will lower energy
costs, insulate consumers from price spikes, and reduce Western nations’
dependence on foreign despots and greedy fossil fuel companies.”
“This is a bill to reduce gas prices and hold Big Oil accountable. As
Russia’s invasion of Ukraine sends gas prices soaring, fossil fuel companies
are raking in record profits. These companies have made billions and used the
profits to enrich their own shareholders while average Americans are hurting at
the pump,” said Representative Khanna. “I’m glad to introduce
this legislation with Senator Whitehouse that will provide an incentive to cap
gas prices and put money back in the pockets of consumers.”
“We have to cut off the Russian oil sales that are funding Putin’s war
crimes in Ukraine. Americans want to put pressure on Putin, but they need help
with high gas prices. So let’s tax oil companies’ war profiteering and send
gasoline rebate checks to Americans,” said Senator Merkley.
“We can no longer allow big oil companies, huge corporations and the
billionaire class to use Putin’s murderous invasion of Ukraine and the ongoing
pandemic as an excuse to price gouge consumers. It is time to enact a windfall
profits tax,” said Senator Sanders.
“Wisconsin is feeling the Putin price hike at the pump and we cannot afford
to have big oil corporations taking advantage of market disruptions to pump up
their profits,” said Senator Baldwin. “I support this
legislation because it can provide some economic relief to working families and
help put their pocketbooks ahead of more profits for big oil.”
“Big oil companies are making near-record profits, while Ohioans pay more
than ever for gas,” said Senator Brown. “This bill will crack
down on Big Oil price gouging, and guarantee that consumers in Ohio and across
the country get money directly back in their pockets if Big Oil continues to
rake in record profits.”
“We need to stop big oil companies from exploiting Russia’s savage invasion
to profiteer and rake in record profits—making consumers pay the price,” said
Senator Blumenthal. “This bill will clamp down on big oil
corporations’ despicable price gouging with targeted taxes while ensuring
consumers pay less.”
“Oil giants are gushing profits due to the global spike in oil and gas
prices over the last year. Meanwhile, consumers and businesses are shouldering
all of the burden and paying more at the pump. The federal government doesn’t
control the price of oil, but we can and should ensure that instead of
funneling record cash back to big oil, this targeted, temporary windfall tax
would deliver real relief at the gas pump. This bill will help working
families, strengthen our economy, and still allow oil companies to profit
without exploiting the American people,” said Senator Reed.
“Oil companies have had decades to deliver on the promise of energy
independence, but instead they got record exports and record profits, while
Americans got volatile gas prices and record climate disruption,” said
Senator Markey. “Instead of an economy creating windfall profits, we
need one creating wind power energy. This bill will protect consumers from
profiteering, particularly as Putin’s war on Ukraine causes the globalized
fossil fuel market to hike up American gas prices.”
“We need to use every tool at our disposal to protect Coloradans from rising
energy costs and provide them relief, and this legislation will help us do
that,” said Senator Bennet. “As Putin wages a reprehensible,
lawless war on Ukraine and sends the global energy market into chaos, we need
to hold large oil and gas companies accountable and prevent them from using
this moment to exploit American consumers. We also urgently need to invest in
America’s clean energy economy to cut costs for families and strengthen our
energy independence, which we can do by passing the extension and expansion of
the clean energy tax credits included in the Finance Committee’s budget
package.”
“Between Putin’s war driving up gas prices and big oil companies
profiteering off the rise, hardworking Americans are getting squeezed at the
gas pump,” said Senator Casey. “It has never been more clear
that we need to reduce our dependence on foreign oil and crack down on
companies taking advantage of a volatile market. This legislation would ensure
oil companies aren’t profiting off the backs of hardworking Americans by
requiring corporations to return half of their excess profits to American
families. This is just one step we can take to lower costs for families and
build an economy that works for families, not corporations.”
The price of a gallon of gasoline is up well over a dollar from a year ago,
and the price of a barrel of oil is double what it was before the pandemic.
Russia’s invasion of Ukraine has further disrupted an already volatile global
oil market by reducing supply and leading governments to limit imports of
Russian energy to help protect the Ukrainian people. At the same time, big oil
companies are reaping near-record profits. In 2021, ExxonMobil’s profits jumped
over 60 percent over pre-pandemic levels to more than $23 billion. Over that
same time period, the price of a gallon of gasoline rose from an average of
$2.69 to $3.41. It currently stands at over $4. This increase is not justified
by increases in the cost of domestic production, but is driven by international
markets controlled by fossil fuel cartels.
The Big Oil Windfall Profits Tax would provide consumers guaranteed relief
while maintaining American competitiveness and reducing pressure on inflation
by attacking corporate profiteering. The legislation would make large oil companies
that produce or import at least 300,000 barrels of oil per day (or did so in
2019) owe a per-barrel tax equal to 50 percent of the difference between the
current price of a barrel of oil and the pre-pandemic average price per barrel
between 2015 and 2019, a period when large oil companies were already earning
large profits. The quarterly tax will apply to both domestically produced and
imported barrels of oil to ensure a level playing field.
Revenue raised from the windfall profits of big oil companies will be
returned to consumers in the form of a quarterly rebate, which would phase out
for single filers who earn more than $75,000 in annual income and joint filers
who earn more than $150,000. With oil currently priced at more than $120 per
barrel, the levy would raise approximately $45 billion per year. At this price,
single filers would receive approximately $240 each year, while joint filers
would receive roughly $360 each year.
Senator Warren has led the fight to crack down on corporations abusing their
market power and engaging in corporate profiteering to protect American
consumers and bring down costs:
- In February, Senator Warren called out corporations for abusing their market power to raise consumer prices and boost profits during a hearing.
- In February, Senator Warren called out private equity and other Wall Street investors at a hearing for exacerbating inflation by jacking up prices and released responses from three corporate landlords that have been increasing rents, driving up housing costs, and raking in profits amid housing shortage.
- Senator Warren called on Commerce Secretary Raimondo to use CHIPS for America Act funding to push back against industry consolidation in the semiconductor industry, address supply-chain resiliency, and bolster competitiveness in the industry. The global chip shortage has resulted in significant price increases for American families and contributed to the recent increases in inflation, as well as job losses due to auto plant shutdowns.
- Senator Warren slammed Hertz’s $2 billion dollar buyback plan, which would line the pockets of company executives and the private equity firm Apollo Global Management, while they raise rental car costs for consumers.
- Senator Warren called out the 11 energy companies for inflating natural gas prices for consumers while reaping record profits.
- Senator Warren called on the Department of Justice to investigate the poultry industry’s anticompetitive behavior as turkey and chicken prices have soared.
###
Next Article Previous Article
