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Oct. 31 (UPI) -- President Joe Biden threatened oil companies Monday with a higher tax on "windfall" profits, if they do not start increasing production to bring down gas prices. "Record profits today are not because they're doing something new or innovative. The profits are a windfall of war," Biden said in brief remarks at the White House, with just over a week before midterm elections.
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"They have a responsibility to act in the interest of their consumers, their community and their country, to invest in America by increasing production and refining capacity," Biden said. "If they don't, they're going to pay a higher tax on their excess profits and face other restrictions," he warned alongside Treasury Secretary Janet Yellen and Energy Secretary Jennifer Granholm.
"It's time for these companies to stop war profiteering, meet their responsibilities to this country, give the American people a break and still do very well," Biden said.
Biden's speech threatening action against oil companies earning record profits comes as Republicans point to high energy prices and soaring inflation heading into next week's midterm elections.
While Biden can not legally impose a tax on companies without a new law from Congress, he vowed to work with lawmakers to make changes.
"My team will work with Congress to look at these options that are available to us and others," he said.
The national average for a gallon of gas was $3.76 on Monday, according to the American Automobile Association. That is 36 cents higher than a year ago, but lower than June when a gallon of regular topped $5.02.
Biden has blamed Russia's war in Ukraine and oil companies for soaring energy prices, but analysts also blame refinery closures and an increase in demand for gas after the pandemic.
The oil industry, which has sought to return profits to their shareholders by buying back their own stocks, blasted Biden's remarks saying more taxes would actually cut production.
"Increasing taxes on American energy discourages investment in new production, which is the exact opposite of what is needed," Mike Sommers, president of American Petroleum Institute, said in a statement.
"Rather than taking credit for price declines and shifting blame for price increases, the Biden administration should get serious about supply and demand imbalance that has caused higher gas prices and created long-term energy challenges," Sommers said. "American families and businesses are looking to lawmakers for solutions, not campaign rhetoric."
Last week, U.S. oil firms Chevron and Exxon Mobil joined a crowded field of energy companies announcing hefty quarterly profits. Chevron turned in $11.2 billion in net profits during the third quarter, nearly double the returns from the same time last year. Exxon Mobile reported its fourth straight quarter of strong returns with $19.7 billion in profits.
"What I mean is profits so high it's hard to believe," Biden said. "Give me a break. Enough is enough."
