President Donald Trump recently lit up social media accusing major oil companies of not passing lower crude prices through to consumers fast enough.
The president’s critics were quick to respond with a tutorial on oil market mechanics: gas stations are independently owned, tanker deliveries take weeks, refineries are price-takers and federal investigations have never once found Big Oil guilty of price gouging in the entire history of the charge.
All of that is true.
But here is what his critics are missing: Trump’s instinct that the major oil companies are not producing what they could is correct. Not because of greed, and not because of price manipulation. Because of Environmental, Social, and Governance (ESG)policies.
The ESG movement spent the better part of a decade infiltrating the boardrooms of America’s largest energy companies. Asset managers like BlackRock, State Street and Vanguard, armed with proxy votes from millions of retirement accounts, pressured the majors into net-zero pledges, methane commitments and capital discipline frameworks that amount to a structural bias against production growth.
The executives running these companies are not villains. Many of them are trapped between market signals that say “drill” and boardroom pressure that says “restrain.” ESG won that argument for years. American consumers are paying for it.
The evidence is not theoretical. Consider three examples.
During the recent conflict that threatened the Strait of Hormuz and sent oil prices sharply higher, domestic producers in the Permian Basin had an opportunity to accelerate output.
Getting more crude to market faster sometimes requires flaring excess natural gas, a routine operational practice that independent producers use routinely. The majors largely held back.
Why? Methane and flaring commitments made to ESG-aligned institutional investors. While the price of oil spiked and American consumers felt it at the pump, some of the largest energy companies in the world sat on production capacity because burning off gas would have violated their green pledges.
Then there is the Arctic National Wildlife Refuge (ANWR).
Congress authorized leasing in ANWR. The Trump administration opened the bidding. The geology is well understood, and the reserves are real. Not a single major oil company submitted a bid. Zero.
The resource is there. The legal authority is there. The national interest is obvious. But ESG commitments to institutional shareholders meant that bidding on Arctic leases was simply off the table.
Smaller independents were the only ones willing to move, and they face capital constraints the majors do not. The result is that a federally authorized domestic reserve sits largely untouched while the administration rightly tries to bring more supply online. When the companies with the deepest pockets and the best drilling technology will not bid on leases the federal government is actively offering, something other than geology and economics is driving the decision.
The third example is less visible but equally telling. In 2024, the major oil companies aligned with the Biden administration in supporting increased financial assurance requirements, known as bonding requirements, for offshore drilling in what was then called the Gulf of Mexico.
The new requirements did not threaten the majors; they’re exempt. The burden falls on smaller independent operators, the same independents who have driven the U.S. production surge of the last decade. Backing rules that kneecap your competitors is not a market decision. It is a strategy dressed up as regulatory compliance.
The pattern here is consistent: ESG-captured management teams have traded production ambition for boardroom approval, and in doing so, they have made American energy less responsive, less competitive and more expensive than it should be.
The president does not need the Department of Justice to investigate price gouging. Those investigations have never produced a conviction because the prices at the pump are not being manipulated.
What he needs is for the work his administration has already begun, rooting out ESG ideology from American financial institutions, to continue with urgency. The Labor Department’s fiduciary duty rules matter. State-level anti-ESG legislation matters. Pressure on the proxy advisory firms that serve as transmission belts for activist agendas into corporate governance matters.
Trump’s frustration is justified. His target is right.
The mechanism is not gouging at the pump. It is green ideology in the executive suite, quietly capping the American energy production that would drive prices down not just this week but for years to come.
The solution is not a federal investigation. It is finishing the job of getting politics out of the boardroom and letting American energy companies act like American energy companies again.
Jason Isaac is founder and CEO of the American Energy Institute and previously served four terms in the Texas House of Representatives.
The views and opinions expressed in this commentary are those of the author and do not reflect the official position of the Daily Caller News Foundation.
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