(Bloomberg) – US energy chiefs sounded consolation at a high-level meeting with top oil executives to discuss rising gasoline prices on Thursday, but the ship has made little progress in its plans to resolve the supply crisis.
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For more than an hour, Energy Secretary Jennifer Granholm met with leaders of some of the nation’s top oil companies in Washington to discuss possible waivers of fuel and air pollution limits and other changes to ease pump prices. Many people familiar with the discussion described anonymity as the meeting was closed to the public.
Granholm stressed that the administration wants to cooperate with industry to increase its processing capacity and increase gasoline production, the people said. His initial comments sought to block some oil industry arguments, stressing that the administration recognizes that refiners from Washington need greater regulatory certainty and support market codes to boost investment in the sector.
People said that although Granholm reduced the possibility of export bans on gasoline and other refined petroleum products, they did not explicitly push trade limits. Administration officials and executives have long discussed the possibility of waiving gasoline from anti-smoking regulations requiring low-volatility fuel in the summer, allowing fuel blenders to mix in low-cost butane. People said such a waiver had to be made by the Environmental Protection Agency, which had no representative at the meeting.
The group devised a strategy to prepare for potential stormwater disruptions to fuel processing and supply.
“The Secretary initiated a collaborative tone by recognizing the global nature of oil markets and prices, and some companies, including Shell, have reduced processing capacity because we are busy converting century-old assets to producing biofuels,” Gretchen Watkins, Shell USA Inc. president, said in a statement. “There is widespread acceptance that Americans are suffering a lot of price pain and that no thoughts are spared in trying to find solutions to it.”
The Watkins administration urged the Gulf of Mexico to accelerate approval to increase oil and gas production in the short term while clearing the way for offshore wind development along the east coast.
President Joe Biden ordered a meeting last week, urging the heads of seven oil companies in letters to explain any reduction in their processing capacity from 2020 when the epidemic prompted plant closures globally. The president urged them to deliver “concrete ideas that will address immediate inventory, pricing and revision capacity issues in the coming months.”
The meeting took place amid rising tensions between the oil industry and the Biden administration, which have risen with the price of oil and lead gasoline, now $ 5 per gallon in the US. Biden has labeled the companies profitable from the crisis but oil refineries and producers blame the government’s fossil fuel agenda for cooling investment.
MORE: Biden escalates the war of words with big oil ahead of talks
Participants included representatives of Shell, Valero Energy Corp., Marathon Petroleum Corporation, Philips 66, BP America, Chevron Corporation and Exxon Mobil Corporation. Several Energy Department officials also took note and then planned to follow up with the companies. Said people familiar with the session, meeting.
Granholm “has made it clear that the administration believes that it is imperative for companies to supply online to get more gas to the pump at lower prices,” the Department of Energy said in an emailed statement. “He reiterated that the president is ready to act quickly and decisively, making appropriate use of the tools available to him, on sensible recommendations.”
The Department of Energy said the discussion involved “technical, economic and policy obstacles to increasing domestic processing capacity.”
Chevron chief executive Mike Wirth blamed Biden for defaming the industry earlier this week, describing it as “a constructive conversation about solving both near-term problems and the long-term stability of energy markets.”
Earlier Thursday, oil industry business groups invited Biden to visit Pennsylvania’s gas fields before heading to Saudi Arabia next month.
The small town of Reynoldsville, Pennsylvania, is “the heart of the Marcellus Shale in the state where you were born, one of the most prolific natural gas-producing regions in the world,” trade associations wrote in the letter. “Before you board Air Force One for the Middle East, we hope you take another look at the power that America has made.”
The White House did not immediately respond to a request for comment on the letter.
(Updates from the 11th paragraph with comments from the Energy Department and Chevron CEO)
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