It is difficult for oil companies to independently solve the problem of high oil prices

　　Recently, US President Biden sent a letter to seven Anglo-American oil majors including Marathon Oil, Valero Energy, Exxon Mobil, Phillips 66, Chevron, BP and Shell, accusing them of acquiring oil during the Russian-Ukrainian conflict.
Record profits, while Americans pay for record-high gas prices at gas stations
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However, companies on the list and the American Petroleum Institute (API) countered that the White House's "wrong policies" are to blame for the current high oil prices
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The author believes that Biden’s move is intended to force oil companies to take the initiative to solve the current high oil price problem.
However, the current problem in the oil and gas industry is that long-term demand expectations for oil and gas conflict with short-term demand, and oil and gas companies alone cannot solve the current high oil prices
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　　At present, many arguments blame the current high oil price problem entirely on the supply shortage caused by the conflict between Russia and Ukraine
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But in fact, in late 2021 before the escalation of the Russian-Ukrainian conflict, the international oil price has hovered around $100 per barrel, much higher than the oil price in 2019
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In 2020, the oil and gas industry in Europe and the United States suffered huge losses.
In 2021, the environmental protection policies in Europe and the United States will be tightened.
The oil and gas industry must shift its limited investment to renewable energy.
Fossil energy investment and financing will also encounter obstacles, which will eventually lead to insufficient investment, which will affect the industry.
production capacity of the enterprise
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In fact, the CEO of Saudi Aramco once said that a major reason for the current high international oil price is the severe oil supply crunch.
The reason for this problem is that oil and gas companies are under pressure to transition to green energy and dare not invest in fossil fuels industry
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　　It is true that due to high oil prices, the current profits of the oil and gas industry can be called huge profits, and the profit-making methods and profit distribution of individual companies are not glorious
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But the oil and gas industry, from OPEC to companies big and small, has been concerned that demand for oil and gas will decrease year by year as renewable energy develops
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At the same time, oil and gas investment cannot be made only to meet short-term needs, and its investment cycle is very long, and companies who invest rashly will suffer from it
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If companies respond to government requirements and increase investment to suppress oil prices, it is entirely possible, but the new oil fields and oil refining facilities obtained by these investments may be difficult to meet the environmental protection requirements of the society in the future.
After the demand for oil and gas decreases, these oil fields and facilities may become "chicken ribs".

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As long as such concerns remain unresolved, the oil and gas industry will not be able to, as Biden put it, “increase refining capacity and production in the short term to ensure that every region is properly supplied
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”

　　At present, for the excess profits of the oil and gas industry, the US Senate has discussed imposing a 21% windfall profits tax on oil and gas companies with revenues of more than $1 billion
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If you can use this to subsidize the price of refined oil, it can indeed solve some problems
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But this also shows that to solve the current high oil price problem, the US government needs to take the initiative to act, rather than simply push the responsibility to the oil and gas industry
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