The American Petroleum Institute (API) today released the following statement from President and CEO Mike Sommers in response to President Biden’s remarks on gas prices:
“Rather than taking credit for price declines and shifting blame for price increases, the Biden administration should get serious about addressing the supply and demand imbalance that has caused higher gas prices and created long-term energy challenges.
“Today, the President proposed to raise taxes on the U.S. natural gas and oil industry that is competing globally to produce the fuels Americans need every single day. Oil companies do not set prices—global commodities markets do.
“Increasing taxes on American energy discourages investment in new production, which is the exact opposite of what is needed. American families and businesses are looking to lawmakers for solutions, not campaign rhetoric.”
Analysis of a windfall profits tax established in 1980 have found that it decreased domestic energy production and increased reliance on imported oil. According to the Congressional Research Service, the tax reduced domestic production by as much as 8 percent from 1980 to 1988 when it was repealed in part because “it made the United States more dependent on foreign oil.”
