article Gasoline prices are soaring because of the explosion in supply.
But the price spike in the US is not due to a dramatic rise in demand.
The problem is that a few oil companies have taken advantage of that rise in supply and overcharged the US government, according to a report released Monday by the Energy Policy Institute.
“Oil companies have been able to leverage their power in the marketplace to increase their profits, thus increasing their share price,” the report says.
The report concludes that while the oil and gas industry is a relatively small player in US politics, the US has been a beneficiary of oil and natural gas extraction in the past 30 years.
“It’s a fact that the oil industry has become so large in recent years, and the result of that is that there’s been so much more government spending on energy than there was during the Great Recession,” the authors of the report said.
“We’re seeing these prices skyrocket, and it’s not because of any demand shock.”
That surge in oil and gasoline prices comes at a time when the US economy is in a deep recession.
Last year, the government reported that gross domestic product (GDP) fell for the third straight quarter and has been declining since the Great Depression.
And despite the economy continuing to expand, oil production has not increased since 2014.
The increase in US production has driven up gasoline prices, which have increased $3 a gallon since the beginning of 2017.
The authors of their report found that “oil companies have leveraged their power and influence to make government spend on energy even more expensive.”
“This has been the case for decades,” they said.
The Energy Policy report, which looked at the amount of spending and tax revenues that the US receives from oil and other natural gas, comes as President Donald Trump prepares to announce his energy policy in Washington, D.C. On Monday, he will unveil a plan to reduce US oil imports and cut greenhouse gas emissions.
But energy experts say the administration is likely to rely on oil companies to help drive up gas prices.
“He’s going to have a lot of leverage, and that leverage is going to be through the oil companies,” said Richard Nadelmann, the president of the American Petroleum Institute.
“[Trump] is going into this with the idea that there is going be a global price on carbon and we need to get the US to the point where we can get to zero carbon emissions.”
And, Nadelman said, “oil is a way for oil companies not to get in the way of a global market, where we’re going to need them.”