WASHINGTON - President Joe Biden asked the Federal Trade Commission on Wednesday to consider whether "illegal conduct" by large oil and gas companies is pushing up gasoline prices for American consumers, the latest effort by the administration to target concentration in the energy industry in a bid to bring down prices at the pump.
The move is unlikely to spur immediate action by the FTC, which has the power to break up large industry players, and it is unlikely to affect gasoline prices materially any time soon.
But it could spur the commission to open an investigation to gather data on how companies set gasoline prices, which could be used in future enforcement actions.
Biden's letter to Lina Khan, the antitrust champion he appointed as chair of the commission, claims "mounting evidence of anti-consumer behavior by oil and gas companies." The president noted that prices at the pump have risen even as the costs of refined fuel have fallen and industry profits have gone up. The two largest players in the industry, ExxonMobil and Chevron, have doubled their net income since 2019, he wrote, while announcing billions of dollars in plans to issue dividends and buy back stock.
The average gallon of gas was nearly $3.40 in the United States on Monday, according to the Energy Information Agency, its highest price in seven years.
If the gap between refined fuel costs and gasoline prices at the pump were to return to normal pre-pandemic levels, drivers would be paying as much as 25 cents less per gallon, White House officials estimate.
"The FTC is concerned about this issue, and we are looking into it," Lindsay Kryzak, a spokeswoman for the commission, said in a statement.
But U.S. Sen. Marsha Blackburn, R-Tennessee, said the president is trying to divert attention from his own inflationary policies.
"Americans are suffering from record high inflation and gas prices because of Biden's reckless spending and anti-business agenda," Blackburn said in a statement Wednesday. "Weaponizing the FTC to scare businesses is an attempt to distract from Biden's failures and is one step closer to his goal of state-controlled companies."
Earlier this year, Biden asked the commission to monitor the gasoline market for any illegal conduct. The commission responded by increasing scrutiny of mergers in the oil and gas industry.
Soaring gas prices, driven by an OPEC choke on production and renewed driving as commuters and travelers return from a pandemic hiatus, have dented Americans' views of the economy and helped fuel an acceleration of inflation that has jeopardized part of Biden's economic agenda in Congress.
The increase has pinned Biden between his goals of reducing the greenhouse gas emissions that drive climate change and keeping costs low for middle-class consumers. Although economists agree that higher gas prices discourage gasoline use, Biden refused to include an increase in the federal gasoline tax as an offset for the spending in his infrastructure negotiations with Republicans.