\n<\/p>\n
With big oil companies poised to reap billions of dollars in profits from the war in Iran, Democratic lawmakers and progressive groups are calling for a windfall tax on major fossil fuel companies.<\/p>\n
The US-Israeli strikes on Iran have triggered the largest ever disruption to fuel supply, according to the International Energy Agency, sending crude costs surging over $100 per barrel in recent days. Those high prices have hit US pocketbooks, with average domestic gas prices topping $3.70 a gallon, and Americans spending more than an additional $2bn to fill their tanks in the past fortnight according to one estimate.<\/p>\n
As ordinary people struggle, corporations are seeing windfall gains. Since the war began last month, share prices for US oil giants ExxonMobil and Chevron have climbed by more than 5% and 7% respectively, while their market values have soared.<\/p>\n
With oil prices continuing to rise, the Rhode Island senator Sheldon Whitehouse and California congressman Ro Khanna have proposed taxing big oil\u2019s windfall profits from the Iran war-fueled crisis.<\/p>\n
\u201cTrump\u2019s war of choice in Iran is not just a moral mistake but an economic blunder that is skyrocketing gas prices for working Americans,\u201d said Khanna in a statement.<\/p>\n
The Guardian has contacted the American Petroleum Institute, the top US oil lobby group, for comment.<\/p>\n
Hours before the bill\u2019s release, dozens of consumer and environmental advocacy organizations sent a formal letter to Congress backing such a proposal.<\/p>\n
\u201cRevenue from a windfall profits tax should be returned directly to struggling American households to help offset rising costs,\u201d says the letter, which was signed by the Make Polluters Pay campaign, the Sierra Club, Public Citizen, and more than 70 other state and national groups.<\/p>\n
The time to impose the tax is now, supporters say. If oil prices remain at their current level, gas prices will continue to rise while US fossil fuel firms could collect an additional $60bn this year, analyses from consultancy firm Rystad Energy and investment bank Jeffries show.<\/p>\n
\u201cEnergy producers and commodity trading firms benefit from volatility in energy prices,\u201d Isabella Weber, an economics professor at the University of Massachusetts Amherst, told the Guardian last week. Windfall taxes, she said, can \u201craise money to cushion the more vulnerable sections of society from cost-of-living pressures\u201d.<\/p>\n
Though the US has not imposed a windfall tax on oil companies since the 1980s, the sector has profited from various fuel crises since. After Russia invaded Ukraine in 2022, oil companies recorded historic profits \u2013 profits that one 2025 study co-authored by Weber found were 13% higher than total investment in the US\u2019s green energy transition that year.<\/p>\n
Donald Trump has insisted that such excess profits benefit ordinary Americans.<\/p>\n
\u201cThe United States is the largest Oil Producer in the World, by far, so when oil prices go up, we make a lot of money,\u201d Trump posted on Truth Social last week.<\/p>\n
The post only holds true if by \u201cwe\u201d Trump meant to refer to wealthy people, according to another 2025 analysis co-authored by Weber. Oil firms\u2019 profits flow to those who own shares in them, either directly or via retirement funds, pensions, or other investments. Those people tend to be well-off, the study found.<\/p>\n
During the 2022 fuel crisis triggered by Russia\u2019s war on Ukraine, 50% of the profits of US oil and gas firms went to the wealthiest 1% of individuals, while the bottom 50% only obtained 1% of profits.<\/p>\n
\u201cSince stock ownership is so heavily skewed towards the richest people in our societies, record profits for energy firms means record income for them,\u201d said Weber. \u201cThe evidence clearly shows that surges in energy prices exacerbate inequality in our societies.\u201d<\/p>\n
A windfall tax could help \u201ccontain inequality and raise money to cushion the more vulnerable sections of society from cost-of-living pressures,\u201d said Weber.<\/p>\n
In their Tuesday letter to congressional leaders, supporters cited a University of Massachusetts Amherst study indicating that if a similar tax had been enacted during the 2022 price shock, roughly $1,715 could have been returned to each American household.<\/p>\n
\u201cOther countries have already demonstrated that this approach works,\u201d the letter says, noting that after the 2022 fuel shock the United Kingdom imposed a windfall tax on oil and gas companies, raising $3.3bn in its first year and $4.5bn the next.<\/p>\n
Khanna and Whitehouse previously proposed a windfall profits tax during the 2022 energy crisis. At the time, one poll showed some 80% <\/strong>of Americans supported the move.<\/p>\n \u201cA windfall profits tax is overwhelmingly popular,\u201d said Jamie Henn, director of the anti-oil and gas non-profit Fossil Free Media, which helped organize support for the current and earlier proposals. \u201cThe only reason Congress won\u2019t pass it is because too many politicians are bought and paid for by big oil.\u201d<\/p>\n Ultimately, the US should quickly move toward a managed transition away from \u201cvolatile fossil fuels\u201d, said Collin Rees, US policy manager at the climate research and advocacy non-profit Oil Change International, which signed the Tuesday letter supporting a windfall tax.<\/p>\n \u201cThat could deliver huge potential benefits there in terms of decreased conflict, in terms of ending the deadly wars for oil that the US keeps waging,\u201d he said. \u201cIn the meantime, we need to stop the oil billionaires from profiteering.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":" With big oil companies poised to reap billions of dollars in profits from the war in Iran, Democratic lawmakers and progressive groups are calling for a windfall tax on major fossil fuel companies. The US-Israeli strikes on Iran have triggered the largest ever disruption to fuel supply, according to the International Energy Agency, sending crude<\/p>\n","protected":false},"author":1,"featured_media":47000,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[50],"tags":[1285,727,581,84,268,124,620,101,1763,261,23543],"class_list":{"0":"post-46999","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-environment","8":"tag-big","9":"tag-billions","10":"tag-democrats","11":"tag-iran","12":"tag-oil","13":"tag-politics","14":"tag-set","15":"tag-tax","16":"tag-urge","17":"tag-war","18":"tag-windfall"},"_links":{"self":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/46999","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=46999"}],"version-history":[{"count":0,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/posts\/46999\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=\/wp\/v2\/media\/47000"}],"wp:attachment":[{"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=46999"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=46999"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/naijaglobalnews.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=46999"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}