The executives of major oil companies rebuffed calls from Democrats on Wednesday to reduce shareholder returns to blunt pain at the pump.
Six energy corporations — Chevron, BP America, Devon Energy, ExxonMobil, Pioneer Natural Resources and Shell USA — during a hearing on alleged “price gouging” rejected pressure to redirect their record profits from paying dividends and stock buybacks to ramping up production and lowering prices.
House Energy and Commerce Committee Chairman Frank Pallone, New Jersey Democrat, cited $45 billion in recent stock buybacks from the six companies combined and another combined $40 billion worth of dividends doled out last year to shareholders as evidence that the corporations have the power to do more to lower prices.
“That’s a lot of money to shareholders, but it’s coming at the expense of the American people who need you to dramatically increase production, not shareholder wealth,” Mr. Pallone said. “Will you commit to doing whatever it takes, including increasing production but also reducing dividends and buybacks in order to lower prices for struggling American consumers?”
The oil executives expressed confidence that they could increase production while also sharing profits with shareholders.
“We can increase production and return value to our shareholders,” Chevron CEO Michael Wirth said.
BP America President David Lawler said he “can’t commit” to a reduction in buybacks and dividends, while both Devon Energy CEO Richard Muncrief and Pioneer Natural Resources CEO Scott Sheffield bluntly stated that “the answer is no.”
Shell USA President Gretchen Watkins said her company planned to make investor returns while also increasing production and investments in renewable energy sources.
“It’s unfortunate that many of you are saying you’re not going to address the increased buybacks and more dividends to your shareholders,” Mr. Pallone said.
Many of the executives highlighted their industry’s record losses during the pandemic from demand plummeting. At one point in 2020, oil market prices went negative, which the companies said resulted in billions of dollars in record losses that record profits in 2021 have helped make up for.
Rep. Ann McLane Kuster, New Hampshire Democrat, conceded that the oil industry had a rough 2020. But she went on to ridicule the executives for their dividend returns and buybacks last year at a time when workers were still being laid off.
“One bad year does not excuse the practice of ripping off American consumers,” Mrs. Kuster said.
• Ramsey Touchberry can be reached at rtouchberry@washingtontimes.com.
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