Oil companies: High gas prices are Bush's fault

The president's ethanol push is discouraging the industry from investing in new refinery capacity, executives say. What does the White House think of that?

Published May 24, 2007 4:20PM (EDT)

For months, in a desperate attempt to avoid the steady stream of bad news from Iraq, President Bush has been criss-crossing the country pumping up his ambitious biofuel proposals. He's taken great pride in touting his "20 by 10 goal" of cutting gasoline consumption in the U.S. 20 percent by 2010, in part by vastly boosting ethanol production.

That being the case, if I were him, and I read the New York Times this morning (which, I admit, is unlikely, but bear with me) and learned that the oil companies were blaming their reluctance to invest in refinery expansion on Bush's ethanol push, I'd be a little annoyed. For six and a half years Bush and Cheney have been bending over backward to serve the interests of oil companies. Heck, some might even say they invaded an entire country on their behalf. And what does the administration get in return?

"If the national policy of the country is to push for dramatic increases in the biofuels industry, this is a disincentive for those making investment decisions on expanding capacity in oil products and refining," said John D. Hofmeister, the president of the Shell Oil Company. "Industrywide, this will have an impact."

Maybe the oil companies feel betrayed, for their own part. It must have been quite a shock to hear their president, a man who hailed from Texas and used to run an oil company himself, call for a 20 percent decrease in gasoline consumption. That's certainly not the kind of president they paid for. And with the current steady flood of grandstanding politicians calling hearings in the House and Senate to discuss refinery underinvestment, possible price gouging, and "unconscionable" windfall profits, they've got plenty of reasons to feel unsettled.

But doesn't the president also have a right to be peeved? There are plenty of reasons to be critical of his plan. Of all the possible biofuel options that exist in the world today, vastly accelerating the production of corn-based ethanol probably makes the least sense, from the standpoint of the environment, food prices and energy efficiency. But it's his plan! It's his signature attempt to address possibly the greatest challenge of the 21st century -- providing adequately for humanity's energy needs -- and now the oil companies have the gall to accuse him of culpability for the current unprecedented run of high gas prices?

Doesn't this call out for some leadership? Perhaps a sharp rap on the knuckles of the oil companies, warning that the prospect for a presidential veto of, say, a price gouging bill would be most unlikely as long as Shell, Exxon, Chevron et al. are taking the position that White House policy is responsible for the current mess? It's hard to think of anything that might improve the president's abysmal poll numbers right now more than a rebuke to Big Oil.

But even as this post was being written, President Bush gave an hourlong press conference in which he talked at length about the war in Iraq and immigration reform, even addressed a question or two on the attorneys scandal, and devoted not one single word to gas prices, or the broadside delivered today by oil companies against Bush administration policy. Granted, no one bothered to even ask him about gas prices, but that's hardly an excuse. Surely he could have found a moment to pull a stern face and warn the oil companies how unseemly it is to be raking in record profits and at the same time blaming him, him, for their lack of interest in boosting gasoline refining capacity.

Nope. Not one word.


By Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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