WASHINGTON (Reuters) – The White House on Friday launched a fresh attack against U.S. oil companies, accusing them of using profits to pay shareholders instead of boosting supply, after Chevron Corp (NYSE:CVX) said its annual profit doubled for 2022.
Chevron posted a record $36.5 billion profit for 2022 that was more than double year-earlier earnings, kicking off what analysts expect to be a bumper earnings season for global energy suppliers.
Earlier this week, Chevron said it would triple its spending on share repurchases to $75 billion over five years at current guidance. Other oil companies are expected to follow suit.
“Companies clearly have everything they need – record profits and thousands of approved permits – to increase production,” White House spokesperson Abdullah Hasan said in a statement.
“The only thing getting in the way is their own decision to keep plowing windfall profits into the pockets of executives and shareholders instead of using them to boost supply.”
Under former President Donald Trump, Congress passed big, retroactive tax breaks for Big Oil, as fuel demand dropped during COVID lockdowns. After oil prices soared following Russia’s invasion of Ukraine, European governments imposed windfall taxes on their oil industries, but U.S. lawmakers are unlikely to do the same.
Chevron and Exxon Mobil (NYSE:XOM) – the nation’s two largest oil producers – are poised to post record annual profits for 2022 of nearly $100 billion combined, analysts forecast.
Chevron did not immediately respond to a request from comment, Exxon declined to comment.
Hasan’s comments mark the latest set of attacks from the White House lambasting oil companies for funneling a windfall of profits to investors. President Joe Biden’s administration tried several times last year without success to convince oil companies to boost output as gasoline prices rose, and Biden ultimately decided to tap the U.S. Strategic Petroleum Reserve (SPR).
Last week, Energy Secretary Jennifer Granholm said Biden will veto a bill by U.S. House of Representatives Republicans that limits the president’s authority to tap the oil reserves if it passes Congress.
U.S. oil producers overall are increasing their budgets for new energy projects this year, but the expenditures will be dwarfed by the amounts paid to shareholders.
The energy industry last year was one of the top sectors in the S&P 500 index after trailing the broader market for years.