- Occidental Petroleum's CEO hit back at California politicians over plans to fine Big Oil firms.
- "I think too many of the politicians just don't understand the industry," Vicki Hollub said.
The CEO of Occidental Petroleum struck back at California lawmakers' plans to fine Big Oil firms for raking in outsized profits through soaring prices at the pump.
Speaking at The Wall Street Journal's CEO Council Summit on Tuesday, Vicki Hollub criticized politicians for not understanding the challenges facing the US oil industry.
"I think too many of the politicians just don't understand the industry. They don't understand any industry," Hollub said.
California governor Gavin Newsom unveiled a plan on Monday, calling for a price gouging penalty on oil companies' hefty profits to deter excessive price increases and protect drivers' wallets. "California's price gouging penalty is simple – either Big Oil reins in the profits and prices, or they'll pay a penalty," Newsom said.
California is among US states that faced surging gas costs this year, with prices climbing as high as $5.45 per gallon a month ago. The average California gas price was $4.665 as of Wednesday, according to AAA. Gas prices have seen a modest pullback in step with a recent drop in oil prices, thanks to President Joe Biden's decision to release record amounts of crude from US reserves to help curb inflation.
The Biden administration has been quick to blame Big Oil firms for the cost increases, calling on them to lower the high prices they've been charging drivers at the pump since Russia invaded Ukraine.
However, there are several factors that have pushed gas prices up, according to Hollub. These include supply chain challenges, difficulty for small oil and gas producers to get bank funding for projects, and worker shortages, specially a lack of truck drivers.
"The trucks are there but the people aren't," Hollub said.
Hollub expects oil to rise in 2023 against a backdrop of such issues. Prices have fallen in the past three to four months partly due to crude releases from US reserves and as recession fears weighed on demand. At last check Wednesday, Brent crude, the global benchmark rose 0.11% to $79.44.