Could 'gas rebate cards' help ease burden of high gas prices?
Could 'gas rebate cards' help ease burden of high gas prices?
The White House is floating the idea of 'gas rebate cards' as a way to reduce the burden of high gas prices just days after President Joe Biden demanded energy companies make more fuel. FOX 26 Business Reporter says the industry doesn't think it's that easy.
HOUSTON - The White House is, reportedly, considering the idea of 'gas rebate cards' as a way to reduce the burden of high gas prices, just days after President Joe Biden demanded energy companies make more fuel.
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The industry, however, is pushing back.
As drivers, across the country, face a palpable pain at the pump, the President's letter that oil companies are making too much money and that they need to refine more gas was met with some head-scratching in Houston's energy sector boardrooms.
"They're trying to make as much gasoline, jet fuel and diesel fuel, for the consumer, as they possibly can," argues Houston oil analyst Andy Lipow.
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Indeed, ExxonMobil responded, saying, "We've been investing through the downturn to increase refining capacity...by about 250,000 barrels a day - the equivalent of adding a new medium-sized refinery."
In other words, demanding more gasoline out of the nation's refineries could be easier said than done.
As a whole, they're running at about 96% capacity, right now. In response to the president's letter, the industry says there are some hurdles, arguing the White House has restricted oil and gas development; canceled infrastructure like the Keystone XL pipeline; created regulatory uncertainty; and proposed new taxes on the industry.
In a letter to the White House, the American Petroleum Institute writes, "Respectfully, the American people need a different direction to solve this crisis."
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In the meantime, some suggest suspending summer-blended fuel could quickly add capacity and trim as much as $0.40, per gallon, within weeks.
"Not only is that less expensive to make, compared to the summer-grade of gasoline, but we would increase the amount of supply and both of those impacts would result in lower gas prices," says Lipow.
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As for the profits that the President criticized, energy companies that drill oil are making more because global prices, for each barrel, have skyrocketed, just as they lost money when demand plummeted during the pandemic. Similarly, for refiners, as demand outstrips supply, prices have increased for what's available.