Don't ‘gouge the American people,’ Biden warns oil industry as Ian nears

President Joe Biden on Wednesday warned oil companies against increasing gasoline prices as Hurricane Ian nears the Florida coastline, vowing to conduct investigations if fuel prices rise.

Biden, speaking at the White House Conference on Hunger, Nutrition, and Health, issued what he called “a warning to oil and gas industry executives: Do not — let me, repeat, do not — do not use this as an excuse to raise gasoline prices or gouge the American people.”

The Interior Department’s Bureau of Safety and Environmental Enforcement, which oversees offshore oil and gas rigs in the Gulf of Mexico, said companies have suspended about 190,000 barrels a day of oil production in the Gulf of Mexico as Ian, a Category 4 hurricane, barrels through the eastern Gulf of Mexico toward Tampa. That would equate to less than 2 percent of total U.S. oil production.

“This small, temporary storm impact on oil production provides no excuse — no excuse — for price increases at the pump,” Biden continued. “None. If companies try to use this storm to raise prices at the pump, I will ask officials to look into whether price gouging is going on.”

Oil and fuel trade associations pushed back on Biden's comments.

“Gasoline prices are determined by market forces — not individual companies — and claims that the price at the pump is anything but a function of supply and demand are false,” a spokesperson for oil company trade association American Petroleum Institute said via email.

The American Fuel and Petrochemical Manufacturers association said the onshore effects of the storm itself would be the biggest factor in fuel prices.

“Our country has seen time and again that major storms and often-correlated runs on gas stations can have a swift impact on prices,” AFPM spokesperson Ericka Perryman said in an email. “Already in Florida, some key areas are functioning with roughly 20 percent of retail stations either out of gas or out of power. That means there is less supply overall and some temporary inability to access supplies in certain Florida communities where there is, at present, heightened local demand.”

Background: Oil prices have fallen below $80 a barrel this week after hitting $122 in June. Gasoline prices, which had been a political thorn in the administration’s side as they reached a nominal record-high of $5.01 a gallon in June, have since fallen to an average of $3.76, according to travel association AAA.

The Biden administration had already called for an investigation into whether the oil industry had colluded to increase prices, though most oil companies no longer own many gasoline stations. Last year, it said it would increase its scrutiny of retail gas station company mergers to see if they were causing fuel prices to increase.