Gasoline prices for pumps have skyrocketed and are likely to rise further in the near future. AAA reported on friday Unleaded regular gas averaged $3.83 per gallon, up from $3.53 on July 4 and hit a record high for 2023. That’s an 8% increase while oil prices are up 10%. There is still room for pump prices to rise further during August.
It’s a simple fact that US gasoline prices track oil prices up and down, which makes sense given that gasoline is derived from crude oil during the refining process. Gas prices are influenced by other factors, including transportation costs, EPA regulations requiring refiners to produce dozens of region-specific summer blends to combat haze, and a shortage of domestic refining capacity.
However, oil prices are the single most stable factor, and there is now a consensus among market analysts that oil prices are likely to continue rising over the final five months of 2023.Views with Saudi Arabia and other OPEC+ member countries to announce this week The current export cuts will be extended until at least September, but the current shortage of supply in global markets is expected to continue for the rest of the year. (Related: Ben Lieberman: From stoves to ceiling fans, the Biden administration has bad regulations in every room in the house)
The Biden Department of Energy, led by Secretary Jennifer Granholm, seems to have responded last week to this reality: cancel a planned purchase Initiate a program to supply 6 million barrels of oil and begin replenishing the long-delayed US Strategic Oil Reserve. Granholm and his DOE staff have paid lip service to comply with regulations mandating timely replenishment of SPR volumes throughout the year, but have so far failed to complete a single transaction. A DOE spokesperson didn’t elaborate on the specific reasons for canceling the latest purchase plan, other than giving the vague rationale of “market conditions.”
Clearly, the most worrying “market condition” for this heavily politicized administration is the prospect of higher gas prices and how it could adversely affect President Biden’s re-election in 2024. Most readers here will be aware that Mr. Biden has done the following: He chose to storm the SPR through much of 2022 in the run-up to the midterm elections, as polls showed Democrats losing support amid rising gas prices. At a time of escalating wars in Europe and heightened tensions with China, Biden and Granholm were perfectly content to draw the country’s insurance policy down to less than half capacity, a level that was in the early 1980s. It was the lowest level seen since then.
This is illegal use of SPR. In response to the first Arab oil embargo and other international crises, Congress mandated he stockpile in December 1975. With the oil embargo, U.S. drivers experienced long lines to refuel their cars for the first time, gasoline prices doubled, and the national economy plunged into a long period of so-called “stagflation.” Reserves exist as tools to protect the country in the event of war or other real-life national emergencies. (Related: David Blackmon: Biden’s EV push could spell death for American automaker)
Biden tried to defend last year’s move by claiming that a $4.00 a gallon gasoline price would amount to some kind of national emergency, but in reality it was a brazen move aimed at lowering gasoline prices as the election neared. It was a political tactic. Gasoline prices did fall for a variety of reasons, but that may have helped Democrats retain control of the U.S. Senate. But the problem is that the depletion of our reserves has made our country even more vulnerable to foreign aggression, and Biden and his political appointees have made the further demolition of this geopolitical asset even more blatant than before. being put in a situation that is viewed as political in nature.
But with the next election just around the corner, and polls showing Biden at best running a close race against both Donald Trump and Ron DeSantis, if he does, he’ll be re-elected. Who doubts that this administration will storm the reserve again if it thinks it will lead to Get ready.
David Blackmon is an energy writer and consultant based in Texas. He spent his 40 years in the oil and gas business, specializing in public policy and communications.
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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