Democratic lawmakers, led by Sen. Elizabeth Warren (D-Mass.), are scrutinizing the lobbying efforts of two energy companies aimed at securing a $1.1 billion tax loophole in the reconciliation mega-bill.
What Happened: On Thursday, Warren, along with Senators Sheldon Whitehouse, Ron Wyden, and Senate minority leader Chuck Schumer (D-N.Y.), sent letters to ConocoPhillips (NYSE:COP) and Ovintiv seeking clarification on their role in the proposed tax change, reported The Guardian. The letter, addressed to ConocoPhillips CEO Ryan Lance and Ovintiv CEO Brendan McCracken, questions the amount spent on lobbying and potential tax reductions if the provision is finalized.
Warren criticized the proposal, stating, “It's an insult to working people to give oil companies a massive tax handout while slashing healthcare and raising energy prices for millions of families.”
Senate Republicans have proposed an exemption to President Biden's 2022 corporate tax law that would allow fossil fuel companies to deduct drilling costs, potentially eliminating their tax liability. The move, backed by major industry players like ConocoPhillips and Ovintiv, targets the 15% minimum tax on billion-dollar corporations under the Inflation Reduction Act.
The proposed tax break is viewed as especially troubling, given that other measures in the draft reconciliation bill could result in higher utility bills and job losses.
Meanwhile, Schumer said, "Republicans would rather kill over 800,000 good-paying jobs and send energy costs skyrocketing than stand up to their big oil billionaire buddies.”
Why It Matters: The senators’ letters come amid a larger debate on the proposed tax breaks and their potential impact. Earlier this week, Warren criticized a provision in President Trump’s “Big Beautiful Bill” that offers Meta Platforms Inc. (NASDAQ:META) a massive tax break, saying the benefits far outweigh what ordinary Americans could ever contribute.
Furthermore, Senate Minority Leader Chuck Schumer has been vocal in his opposition to the GOP’s budget reconciliation bill, dubbed the “One Big, Beautiful Bill,” for its extensive cutbacks on welfare, alongside tax breaks for the wealthy. Schumer has called the bill “flawed” and “irredeemable”, stating that it will kick millions off healthcare and kill good-paying energy jobs while taking food away from children.
Meanwhile, President Donald Trump has been pushing the Senate to pass his ‘Big, Beautiful Bill’ bill before the July 4 deadline.
On a year to date basis, shares of ConocoPhillips tumbled 9.18%, as per Benzinga Pro.
Image via Shutterstock
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
