Energy & Environment — Energy Democrats grill oil execs on gas prices

by Rachel Frazin and Zack Budryk - 04/06/22 7:16 PM ET

Today we’re looking at a House hearing with oil executives, as well as a tiff between a Democratic senator and EPA Administrator Michael Regan. Then we’ll examine the Supreme Court ordering a return to a Trump-era EPA rule.

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Lawmakers press oil CEOs on high gas prices

Democrats on a subcommittee of the House Energy and Commerce Committee grilled oil executives Wednesday over the disparities between oil and gas prices, while the committee’s Republican members framed high prices as a consequence of Biden administration energy policies.

Oversight and Investigations Subcommittee Chair Diana DeGette (D-Colo.) confronted the witnesses, who included executives from BP, Chevron, ExxonMobil, Devon Energy and Shell and Pioneer Natural Resources, directly asking them “Why is there a disconnect between the falling price of crude oil and the fact that the cost of gas is staying the same?”

What did they say? In response, BP Chairman and President David Lawler cited the complicating factors along the supply chain that he said may delay any drop in oil prices being reflected in gas prices.

Democrats on the panel repeatedly emphasized the record profits the oil industry reported in 2021. Energy and Commerce Committee Chair Frank Pallone Jr. (D-N.J.) asked each witness for their profits in the previous year as well as whether they would commit to “doing whatever it takes, including increase production and reducing dividends and buybacks, to help American consumers.”

While the witnesses generally committed to increasing production, they were noncommittal or outright declined to say they would reduce buybacks.

Rep. Paul Tonko (D-N.Y.) noted that domestic U.S. oil production has increased since President Biden took office by about 2 billion barrels a day, while Rep. Ann Kuster (D-N.H.) lambasted the executives for referring back to the financial hardships of 2020.

“One bad year does not excuse the practice of ripping off consumers,” Kuster said.

Meanwhile, on the other side of the aisle: The witnesses largely defended their business practices, denying under oath that they had artificially increased prices to profit from the Ukraine conflict when questioned by Rep. Morgan Griffith (R-Va.), the ranking member of the oversight and investigations subcommittee.

Pioneer CEO Scott Sheffield said the company’s production was constrained because “we can’t get people back” to work on oil extraction in the Permian Basin.

Griffith repeatedly pressed the witnesses on whether the Biden administration’s budget request mentioning an end to fossil fuel subsidies discouraged production. The witnesses were largely noncommittal except for BP CEO Darren Woods, who said it could have had a “chilling effect.”

Democrat pushes EPA chief on climate rules’ pace

A Democratic senator on Wednesday pressed the Biden administration about why it has yet to complete certain climate regulations, raising concerns about how long it is taking.

In a rare moment of intraparty tension, Sen. Sheldon Whitehouse (D-R.I.) questioned EPA Administrator Michael Regan about how long it is taking the agency to develop new climate regulations for pollution sources including power plants, chemical plants, oil refineries and aircrafts.

“How long do you think you have?” Whitehouse asked.

Regan’s response: Regan said the agency only had limited resources and blamed “the state that the EPA found itself in when President Biden was elected.”

“Since I’ve been there for the past year, we’ve got staff working nights and weekends,” the administrator said. “I’m really proud of the record that we have when you look at the rules that we have proposed and finalized within the first year of the Biden administration.”

“I’m am damn proud of what this agency has done over the past year with the resources that we have,” he added.

“The problem is that in an emergency, effort doesn’t count, results count,” Whitehouse shot back.

On power plants in particular, Regan noted an ongoing Supreme Court case that could limit which tools the agency has at its disposal.

“We’re going to be ready to go as soon as the Supreme Court rules,” he said.

Supreme Court reinstates Trump water permit rule

The Supreme Court on Wednesday halted a prior court ruling that struck down a Trump-era rule limiting state and tribal authority to veto projects that could impact their waters, including pipelines.

The Trump rule in question, which was nixed by a federal court in October, limited states’ authority to block projects by giving them a strict one-year time limit to do so. If it did not meet this time limit, the government could determine that it had waived its veto power.

The rule also limited the scope to only those that will impact water quality. It excluded other considerations, such as air quality or “energy policy.”

The high court on Wednesday halted that vacatur, reinstating the rule for the time being, in a 5-4 decision. Chief Justice John Roberts joined the court’s three liberal justices in dissenting.

A dissent, penned by Justice Elena Kagan, argued that the states and industry groups who had asked the court for the pause didn’t prove that not doing so would cause “irreparable harm” and therefore did not qualify for a stay.

“The applicants here have not met our standard because they have failed to substantiate their assertions of irreparable harm. The Court therefore has no warrant to grant emergency relief,” she wrote.

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Energy & Environment — Energy Democrats grill oil execs on gas prices

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