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CHILL BABY CHILL
If you’re looking for someone to blame for high gas prices, we’re here to help. Hint: It’s not President Biden.
Here’s the deal: Gasoline prices have surged to seven-year highs and are likely to keep climbing. But, as my colleague Matt Egan writes, American oil companies are in no rush to loosen the spigots anytime soon. Why? Shareholders have cajoled oil companies to finally live within their means.
“Stop spending like drunk sailors. That’s the message from shareholders,” said Pavel Molchanov, an analyst at Raymond James.
A BIT OF BACKGROUND
- Drill baby drill: US oil companies used to ramp up production at even the slightest hint of higher prices.
- That kept prices at the pump relatively low. And it made the United States the king of the oil world, surpassing both Saudi Arabia and Russia in production.
- But the strategy was terrible for the oil industry’s bottom line. The oil-and-gas sector was easily the stock market’s biggest loser in the 2010s.
These days, the industry’s chastened by two big forces: Shareholders, who pressured the companies to cut costs, and, the whole, like, you know… historic mass reckoning with the environmental devastation wrought by fossil fuels.
Even though US oil prices have surged by more than 65% this year, US oil production is about 14% below where they were at the end of 2019.
So basically: Blame Wall Street. Oil and gas companies aren’t producing more because they’re focused on returning cash to shareholders.
The situation has put Biden in quite a pickle, though. In theory, he could pressure oil executives to ramp up production to lower the costs for American drivers. And in that hypothetical, the oil guys can ask Biden to ease off environmental regulations. But that’s not really an option for Biden, who ran on the most aggressive climate agenda in US history and who just went to Glasgow earlier this month to urge the rest of the world to cut back on fossil fuels.
NUMBER OF THE DAY: $5 BILLION
Hey, everybody’s gotta pay taxes, even Elon Musk (though proportionally he pays a lot less than you and I do…don’t even get me started). To cover a looming tax bill that’s expected to be north of $11 billion, Musk sold roughly $5 billion worth of Tesla shares this week, the first time he’s done so since 2016. There’ll be more sales like this to come, as he’s indicated he’ll sell 10% of his Tesla stake to exercise options that expire next year.
Portugal just made it illegal for bosses to call, text or email employees outside of their regular working hours. Illegal! (Every journalist I know read that headline and broke into laughter, the kind of nervous giggle we’ve learned to deploy to keep from crying.)
“The employer must respect the privacy of the worker,” including periods of rest and family time, the new law stipulates. (LOL workers’ rights, get outta here.)
Any violation, it continues, constitutes a “serious” offense and could result in a fine. (OK you socialist snowflakes, get ready to see your workers come in well rested and lacking a nagging sense of doom that pushes them into a vortex of intangible “productivity” and watch your economy crumble!)
A similar rule gave French workers the right to ignore after-hours business emails in 2017. (Mon dieu!)
The measure also stipulates that employers are responsible for providing workers with the appropriate tools to do their jobs remotely. (They can… they can mandate that?)
They should reimburse workers for any additional expenses, including any increase in bills such as electricity and gas, they might incur while working from home. (* quietly sobbing *)
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