The president who started the war that pushed gasoline past four dollars a gallon is now telling the oil companies they are making too much money. Over the weekend, Donald Trump turned on ExxonMobil and Chevron, saying they were profiting excessively from the conflict and should give some of that money back to the public. The attack came days after both companies reported strong earnings, and it marks a notable break with the industry that has been one of his most loyal constituencies.
The remarkable part is not the demand. It is the timing and the source. Trump is complaining about oil company profits in the middle of a war his own administration is fighting, a war that has closed the Strait of Hormuz, drawn the Houthis into attacking Saudi tankers in the Red Sea, and driven oil prices to their most volatile levels in years. Oil briefly passed $100 a barrel in late July before falling back to around $84. Gasoline topped four dollars a gallon weeks ago. The scarcity that is filling Exxon’s and Chevron’s accounts was created by a supply shock, and the supply shock was created by the president’s war. He made the prices. The companies are just collecting the receipts.
The politician’s arithmetic
Congressional elections come in November, and the price at the pump is the war’s most visible cost to American households. Trump has been trying to get prices down for weeks. He told energy retailers to cut their prices, with no visible effect, because retailers do not set oil prices. Now he has moved up the chain to the producers, the ones with actual earnings statements and actual headlines. Telling Exxon to give money back polls better than explaining that a war over the world’s most important shipping lane is expensive.
There is also a history here that makes the fight awkward for both sides. Trump spent his first term and the first years of his second courting the oil industry, promising deregulation, opening federal lands, demanding more drilling. He has treated high production as the answer to high prices, and the industry has treated him as its champion. A president who spent years praising the oilmen cannot now convincingly cast them as war profiteers. The companies, for their part, have spent years reminding everyone that they do not control the global price of crude, that pump prices are set in a world market, and that their profit margins are not the same thing as the price at the station. All of that is true, and none of it will stop the fight.
Who pays for the war
The deeper question is who pays for the war. The fight over oil profits is a fight over that question. The war has made gasoline expensive, and every American who drives is paying for it. The oil companies are also paying, in the sense that they are collecting the difference between a war economy’s prices and a peacetime economy’s costs. Trump wants them to hand that difference back, as if the windfall were a favor he granted rather than a consequence of his own policy. The industry will resist, quietly, and it has leverage: it can slow production, delay investment, and let the president own the shortage. A president who needs the oilmen for supply cannot afford to make them enemies, and the oilmen know it.
The skeptic’s case deserves a hearing. Exxon and Chevron did report fat profits while consumers struggled, and a president demanding lower prices in wartime is doing an ordinary political thing. Oil companies have never hesitated to claim credit when prices fell, so they cannot complain when they are blamed when prices rise. There is nothing illegitimate about the public asking why the companies are doing so well out of a war nobody wanted.
But the direction of the blame is wrong, and the misdirection is the point. The war made oil expensive. The oil companies are a symptom, not the cause. Trump is attacking them because he cannot attack the war, which is his own. It is the oldest trick in politics: when the policy fails, blame the messenger who profited from it. The oilmen are an easier target than the Strait of Hormuz, and a cheaper one than the truth. Someone will pay for this war, and the president is making it clear it will not be him.
Source
- The Guardian: Trump accuses oil companies of ‘making too much money’ from his war on Iran
- Reuters: Trump blasts Exxon, Chevron for making ‘too much money,’ demands lower gasoline prices
- Politico: ‘Making too much money’: Trump blasts Exxon Mobil, Chevron profits
- CNBC: Trump says Exxon and Chevron made ‘too much money’ during Iran conflict