Biden Warns Oil Companies Again: "War Profits Should Not Be Used for Stock Buybacks or Dividends"

[Image source=AP Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] U.S. President Joe Biden officially announced on the 19th (local time) that he will release an additional 15 million barrels of strategic petroleum reserves to curb the decline in oil prices. He also urged oil companies to increase production and lower prices, warning that "profits made during the war should not be used for stock buybacks or dividends."

According to the White House, President Biden made this announcement during a speech on strengthening energy security at the White House. He said, "We will release an additional 15 million barrels from the strategic petroleum reserve," adding, "If necessary, we will also consider releasing more strategic petroleum reserves within a few months."

Earlier, the U.S. decided to release 180 million barrels of strategic petroleum reserves about a month after the outbreak of the Ukraine war. The 15 million barrels announced this time are part of the volume approved then but not sold, the White House confirmed. The release of strategic petroleum reserves is one of the tools the U.S. president can independently use to curb inflation.

President Biden also raised his voice of criticism toward oil companies on this day. He pointed out, "Since mid-June, crude oil prices have dropped nearly $40 per barrel, but consumer prices have not decreased accordingly," accusing refiners of making huge profits.

He continued, "The message to U.S. energy companies is this: profits should not be used for stock buybacks or dividends. Now, while the war is ongoing, (profits should not be used in this way)," emphasizing that such profits should be invested in price adjustments and production expansion.

On this day, President Biden also called on Congress to accelerate legislation that can expedite permits for eco-friendly energy projects. He also confirmed plans to purchase oil to replenish the strategic petroleum reserves.

President Biden explained, "Currently, the strategic petroleum reserves hold more than 400 million barrels, about half full, which is sufficient for emergency response," adding, "In the coming years, when the price per barrel reaches $70, the U.S. government will purchase oil to fill the strategic petroleum reserves." He added, "Refiners can also invest in increased production with the confidence that they can later sell at $70 per barrel."

The White House also confirmed, "We plan to repurchase strategic petroleum reserves when prices are between $67 and $72 per barrel," stating, "This will encourage corporate production investment, improve U.S. energy security, and help lower energy prices that have risen due to the Ukraine war."

In particular, this speech drew more attention as oil prices have recently shown signs of rising again. President Biden has claimed that his economic policies have been effective over the past few months, citing the downward trend in oil prices as a representative example. According to the American Automobile Association (AAA), as of this day, the national average gasoline price in the U.S. stands at $3.854. Although lower than the $5 per gallon level reached in June, it is more than 17 cents higher than a month ago and over 51 cents higher than a year ago.

Local media interpret President Biden's decision to release strategic petroleum reserves as a "pre-election move to control inflation," given that rising gasoline prices significantly impact the inflation felt in daily life.

Regarding this, President Biden emphasized, "This is not politically motivated," adding, "This is to continue what I have been doing." When asked what he thought Russian President Vladimir Putin might be thinking, he replied, "I think Putin is in an incredibly difficult position."

This content was produced with the assistance of AI translation services.