The American Petroleum Institute receives millions from oil companies – and works behinds the scenes to stall or weaken legislation
When Royal Dutch Shell published its annual environmental report in April, it boasted that it was investing heavily in renewable energy. The oil giant committed to installing hundreds of thousands of charging stations for electric vehicles around the world to help offset the harm caused by burning fossil fuels.
On the same day, Shell issued a separate report revealing that its single largest donation to political lobby groups last year was made to the American Petroleum Institute, one of the US’s most powerful trade organizations, which drives the oil industry’s relationship with Congress.
Contrary to Shell’s public statements in support of electric vehicles, API’s chief executive, Mike Sommers, has pledged to resist a raft of Joe Biden’s environmental measures, including proposals to fund new charging points in the US. He claims a “rushed transition” to electric vehicles is part of “government action to limit Americans’ transportation choice”.
Shell donated more than $10m to API last year alone.
And it’s not just Shell. Most other oil conglomerates are also major funders, including ExxonMobil, Chevron and BP, although they have not made their contributions public.
The deep financial ties underscore API’s power and influence across the oil and gas industry, and what politicians describe as the trade group’s defining role in setting major obstacles to new climate policies and legislation.
Critics accuse Shell and other major oil firms of using API as cover for the industry. While companies run publicity campaigns claiming to take the climate emergency seriously, the trade group works behind the scenes in Congress to stall or weaken environmental legislation.
Earlier this year, an Exxon lobbyist in Washington was secretly recorded by Greenpeace describing API as the industry’s “whipping boy” to direct public and political criticism away from individual companies.
Senator Sheldon Whitehouse, a Rhode Island Democrat and strident critic of big oil’s public relations tactics, accused API of “lying on a massive industrial scale” about the climate crisis in order to stall legislation to combat global heating.
“The major oil companies and API move very much together,” he said.
Whitehouse said the oil and gas industry now recognizes it is no longer “socially acceptable” to outright deny climate change, and that companies are under pressure to claim they support new energy solutions that are less harmful to the environment. But that does not mean their claims should be taken at face value.
“The question as to whether they’re even sincere about that, or whether this is just ‘Climate is a hoax 2.0’, is an unknown at this point,” he added.
Shell has defended its funding by saying that while it is “misaligned” with some of API’s policies, the company continues to sit on the group’s board and executive committee in order to have “a greater positive impact” from within. The petroleum firm claims that its influence helped manoeuvre API, which represents about 600 drilling companies, refiners and other interests such as plastics makers, toward finally supporting a tax on carbon earlier this year.
With Biden in the White House and growing public awareness of global heating, there are signs API’s influence may be weakening as its own members become divided on how to respond.
The French oil company Total quit the group earlier this year over its climate policies. Shareholder rebellions are pressing Exxon and Chevron to move away from dependence on oil. Top clean energy executives at Shell quit in December over the pace of change by the company.
API is also fighting a growing number of lawsuits, led by the state of Minnesota, alleging that the trade group was at the heart of a decades-long “disinformation campaign” on behalf of big oil to deny the threat from fossil fuels.
But despite threats to API’s lasting influence, Whitehouse argues the trade organization represents the true face of the industry. Instead of using its considerable power to push for environmentally friendly energy laws, API is still lobbying to stall progress with the oil industry’s blessing.
“Their political effort at this point is purely negative, purely against serious climate legislation. And many of them continue to fund the fraudulent climate denialists that have been their mouthpieces for a decade or more,” Whitehouse said.