WASHINGTON –As the five largest publicly traded oil companies boast to Wall Street about their record $264.3 billion haul in 2022, U.S. Senators Chris Murphy (D-Conn.) and Richard Blumenthal (D-Conn.) joined 15 of their Senate colleagues in reintroducing the Big Oil Windfall Profits Tax Act to crack down on profiteering by Big Oil and return the industry’s excessive gains to working people. 

“The oil and gas industry raked in record-breaking profits this year because they used Russia’s war on Ukraine as an excuse to engage in price gouging and crush families trying to fill up their gas tanks. This legislation is a much-needed course correction that would hold Big Oil accountable for its inexcusable greed and get money back in the pockets of Americans who have been squeezed at the pump,” said Murphy.

“Oil giants should be compelled to return some of their record profits to consumers struggling with high prices. While the industry’s greed leads to consumer pain at the pump, our windfall profits penalty puts an end to the price gouging and corporate profiteering – putting hard-earned dollars back in family pockets through common sense rebates,” said Blumenthal.

The five largest publicly traded oil companies – Exxon Mobil, Chevron, BP, Shell, and TotalEnergies – hauled in pre-tax profits totaling $264.3 billion in fiscal year 2022.  Exxon alone reported $77.8 billion in profits in 2022, smashing the earnings record of any American or European oil company.  Exxon also announced plans to keep oil production flat for the year ahead.  Rival oil giant Chevron – flush with $49.7 billion in profits – greenlit $75 billion in stock buybacks in 2023 to benefit its wealthy executives and shareholders on Wall Street.  

Last year, gas prices briefly surpassed $5 a gallon, squeezing the budgets of families in Connecticut and across the country.  While the price of gas has fallen significantly since then, it remains well above pre-pandemic levels.

The Big Oil Windfall Profits Tax Act would:

  • Claw back Big Oil’s windfall profits.  Large oil companies will owe a per-barrel quarterly tax equal to 50 percent of the difference between the current price of a barrel of oil and the pre-pandemic average price per barrel between 2015 and 2019.  It will apply to both domestically produced and imported barrels of oil to ensure a level playing field.  The clawback will apply to oil profits in 2022 and going forward so that Americans gouged by high prices are made whole.
  • Apply only to the largest companies.  Large companies that produce or import at least 300,000 barrels of oil per day will be subject to the legislation.  Smaller companies accounting for roughly 70 percent of domestic production will be exempt, so oil giants like Exxon and Chevron cannot simply gouge consumers further without the threat of losing market share.
  • Lower consumer costs with relief rebates.  Revenue raised from the windfall profits of big oil companies will be returned to consumers in the form of a quarterly rebate, which would phase out for single filers who earn more than $75,000 in annual income and joint filers who earn more than $150,000.  With oil priced at roughly $90-100 per barrel, this levy would raise approximately $48.1 billion per year.  At this price, single filers would receive an estimated $255 each year and joint filers $382. 

The Senate legislation is cosponsored by U.S. Senators Alex Padilla (D-Calif.), Jeff Merkley (D-Ore.), Sherrod Brown (D-Ohio), Bob Casey (D-Pa.), Elizabeth Warren (D-Mass.), Edward Markey (D-Mass.), Michael Bennet (D-Colo.), Tim Kaine (D-Va.), Raphael Warnock (D-Ga.), Tammy Baldwin (D-Wis.), Cory Booker (D-N.J.), Debbie Stabenow (D-Mich.), Bernie Sanders (I-Vt.), and Jack Reed (D-R.I.). 

Text of the bill can be found here