President Biden asks for FTC to look into gas prices, possible illegal activity

President Biden has asked the FTC to examine why prices at the pump aren’t going down, despite declining oil and gas prices.

In a letter addressed to FTC commissioner Lina Khan, Biden referred to mounting evidence of anti-consumer behavior by oil and gas companies.

“The bottom line is this: gasoline prices at the pump remain high, even though oil and gas companies’ costs are declining. The Federal Trade Commission has authority to consider whether illegal conduct is costing families at the pump. I believe you should do so immediately.”

Biden went on to say that “prices at the pump have continued to rise, even as refined fuel costs go down and industry profits go up.”

“Usually, prices at the pump correspond to movements in the price of unfinished gasoline, which is the main ingredient in the gas people buy at the gas station. But in the last month, the price of unfinished gasoline is down more than 5 percent while gas prices at the pump are up 3 percent in that same period. This unexplained large gap between the price of unfinished gasoline and the average price at the pump is well above the pre-pandemic average. Meanwhile, the largest oil and gas companies in America are generating significant profits off higher energy prices. The two largest oil and gas companies in the United States, as measured by market capitalization, are on track to nearly double their net income over 2019—the last full year before the pandemic. They have announced plans to engage in billions of dollars of stock buybacks and dividends this year or next.”

Biden closed the letter by referring to possible wrongdoing without citing specifics.

“I do not accept hard-working Americans paying more for gas because of anti-competitive or otherwise potentially illegal conduct. I therefore ask that the Commission further examine what is happening with oil and gas markets, and that you bring all of the Commission’s tools to bear if you uncover any wrongdoing.”

Gas prices have continued to climb since late 2020 largely due to increase in demand after the decline of pandemic lockdowns.

Biden’s options to decrease prices at the pump are limited, however, some democrats have pushed the President to release barrels from the country’s emergency oil reserve or to possibly ban oil exports.