Aug. 4 at 12:37 AM
$XOM $CVX I understand the frustration with high gasoline prices, but I disagree with President Trump’s diagnosis.
Exxon Mobil and Chevron earned a combined
$26.6 billion in the second quarter. Those are extraordinary profits, driven by higher crude prices, strong refining margins and disrupted global energy flows. But benefiting from scarcity is not the same as causing it.
Exxon and Chevron do not simply choose a national pump price. Retail gasoline reflects global crude costs, refinery capacity and margins, distribution, marketing, taxes and local competition. Pump prices also adjust with a lag after wholesale prices change.
If there is evidence of collusion or price manipulation, investigate it. Record profits alone are not that evidence.
The better policy question is how to encourage durable production, refining capacity and infrastructure investment. Telling companies to invest during shortages—and then condemning the resulting profits—sends a contradictory signal.
