This morning, the American Automobile Association reports that the national average price of gasoline is $3.44 per gallon for regular unleaded – ten cents higher than it was less than two weeks ago!
That price is actually a few cents higher than it was on November 24, one day after President Biden announced the release of 50 million barrels of oil from the Strategic Petroleum Reserve; that day the national average price for a gallon of regular gasoline was $3.39. In late December, it dropped to $3.28.
Clearly, despite the president touting the release as “a tool matched to today’s specific economic environment, where markets expect future oil prices to be lower than they are today, and helps provide relief to Americans immediately and bridge to that period of expected lower oil prices,” the effect on prices was short-lived and minimal.
But there’s reason to think that deep down, President Biden suspected the release from the reserves wouldn’t have much effect.
Not many people noticed that back in October, during a town hall on CNN moderated by Anderson Cooper, Biden downplayed the effectiveness of releasing oil from the strategic petroleum reserve. “I could go in the petroleum reserve and take out, and probably reduce the price of gas maybe 18 cents or so a gallon. It’s still going to be above three bucks.”
Sometime between then and late November, someone changed Biden’s mind. Perhaps he concluded the public anger over high gas prices was getting so intense, he had to do something, even if it wouldn’t lower prices much.
Oh, and the outlook on gas prices for the coming weeks and months is downright dire:
“Gas prices saw their sharpest rise in months last week as oil surged to $93 per barrel, on continued concerns over Russia invading Ukraine and that there won’t be enough supply to meet demand come this summer,” said Patrick De Haan, head of petroleum analysis at GasBuddy. “With the national average at its highest level since 2014, the news is grim: motorists should expect even more price increases, with the larger jumps coming later this spring as a confluence of seasonal factors and the potential flare up in geopolitical tensions. Ultimately, the national average could be pushed to record territory by the start of the summer driving season.”
Oh, and in that October appearance on CNN, Biden predicted, “My guess is you’ll start to see gas prices come down as we get by going into the winter — I mean, excuse me, into next year, 2022.”