Energy Secretary Granholm calls on oil industry to help reduce gasoline prices
Energy Secretary Jennifer Granholm said she’s asking the oil and gas industry to help bring painful gasoline prices at the pump down to a reasonable level during a visit to North Texas on Friday.
Granholm said “nothing has been taken off the table” when it comes to working with the oil and gas industry to find solutions for gasoline prices that have averaged $5 a gallon this week.
“We are calling upon them to be part of this, be American, be focused on increasing production to relieve the pain that people are experiencing at the pump,” Granholm said.
On Wednesday, President Joe Biden called on major U.S. oil refineries to increase production and help address gas prices.
Industry leaders responded that refineries are operating nearly at full tilt and there is no quick or simple way of increasing their capacity to turn crude oil into gasoline and diesel fuel in a complex market.
Granholm visited North Texas to announce that, after six months, Lennox International was the first company to complete a challenge to create a high-efficiency heat pump that works in extremely cold climates.
“At a time where people are paying high fuel costs, we want to make sure people have access to technology that reduces the expense that they have to pay for their utility bills,” said Granholm at a tour of the company’s Carrollton facility.
Granholm said there is “upward pressure” on gasoline prices as people take to the roads over the summer, and that prices are hard to predict because they are influenced by global events like the Russia-Ukraine war, bans on Russian oil and China emerging from the pandemic. She said the Energy Information Administration expects prices to decline to around $4.37 by the end of the year.
”The president believes that we have to have more energy,” she said. “We’ve got, at this moment with the price being so high, to invest in producing oil and gas for consumers.”
But Granholm said it’s also important to increase investments, research and development of clean energy.
The Biden Administration has a goal of building infrastructure to develop clean energy and attain net-zero emissions in the U.S. by 2050. At the same time, Biden has led global efforts to counter Russia’s attack on Ukraine by buying less Russian oil and more U.S. oil. The White House has blamed the high energy prices on a mix of factors, including the COVID-19 pandemic, Russia’s invasion of Ukraine and oil companies focusing on profit over production.
The cost of energy is a core element of the inflation currently hammering Americans and endangering Democrats’ election prospects in the fall.
Biden is releasing a record million barrels of oil a day from the U.S. Strategic Petroleum Reserve.
During the pandemic, the U.S. lost 1.1 million barrels worth of daily refining capacity, with at least seven refining facilities shuttering, closing units or transitioning away from petroleum processing, according to the American Fuel and Petrochemical Manufacturers.
On Wednesday, Biden sent letters to seven oil refiners asking them to explain for any reduction in capacity since 2020 and offer ideas to address immediate energy issues ahead of an emergency meeting he asked Granholm to convene.
”Today’s situation did not materialize overnight and will not be quickly solved,” a response letter from the American Fuel and Petrochemical Manufacturers and the American Petroleum Institute said.
They say the Russia-Ukraine war exacerbated a fuel situation that was created by an imbalance between supply and demand, logistics reshuffling during the pandemic, a ban on Russian products and policy decisions made over several years and administrations.
Granholm said the administration is calling for increased production in the oil and gas industry domestically and abroad because increasing the production of gas is a key solution for the prices.
“The president wants to hear about how to break down the price for people because it is getting to an unsustainable level,” Granholm said.