- National gasoline prices will rise to over $4 a gallon due to growing fuel demand and the Organization of Petroleum Exporting Countries’ oil production cuts, experts told the Daily Caller News Foundation.
- “The higher crude oil prices along with a general increase in gasoline demand will drive the gas prices at the gas stations higher,” Rohit Rathod, a senior oil market analyst at Vortexa, told the DCNF.
- “They’ve chosen to go after the oil industry for war profiteering and price gouging while they are canceling pipelines and instituting drilling moratoriums,” Phil Flynn, a senior energy analyst at The PRICE Futures Group, told the DCNF.
Nationwide gasoline prices will surpass $4 per gallon as oil prices spike thanks to rising winter demand and the Organization of Petroleum Exporting Countries’ (OPEC) heavy production cuts, experts told the Daily Caller News Foundation, endangering Democrats’ midterm hopes.
Gas prices across the country have been rising for nearly three weeks and may go up even further after OPEC and its Russia-led allies, together known as OPEC+, cut daily production by over two million barrels of crude oil on Oct. 5, causing crude oil prices to increase, experts told the DCNF. The nationwide average gas price sits at $3.92, which is 14 cents higher than the gas price on Sept. 29, according to AAA data. (RELATED: Top Oil Industry Groups Hammer Biden Admin’s Plan To Ban, Limit Fuel Exports)
“The price of crude oil is up about $10 over the last week as it became apparent that the group [OPEC] was contemplating a big cut,” Mark Finley, a fellow in energy and global oil at Rice University’s Baker Institute, told DCNF. “$10 a barrel is roughly equivalent to 40 cents per gallon at the gas station.”
The price hikes throw a wrench in Democrats’ midterm plans; the White House is desperate to keep gas prices low as it believes that prices at the pump heavily influence voters’ perception of the economy, Politico reported in May. At the same time, the Biden administration is attempting to blame oil companies for “price gouging” as price hikes at the pump may hurt the Democrats’ odds in the November midterm elections.
The Biden administration has released 155 million barrels of oil from the nation’s emergency stockpile since April to help lower high gas prices that were caused by supply constraints exacerbated by Russia’s invasion of Ukraine, according to the Department of Energy (DOE). Gas prices fell for nearly 100 days straight after peaking in June; however, they began rising again on Sept. 22.
President Joe Biden added a great deal of oil to the market by draining the U.S. Strategic Petroleum Reserves (SPR), raising supply and lowering prices; however, OPEC+ cut production, meaning that the effects of Biden’s draining of the emergency stockpiles will be quickly negated, according to Flynn. The SPR has 408.7 million barrels of oil remaining in its stockpile as of Oct. 7 and is at its lowest level in nearly 40 years, according to Energy Information Administration data.
“We released all this oil from the reserve into the market but now OPEC+ is cutting production, so within a matter of months, all that oil has been removed,” Phil Flynn, a senior energy analyst at The PRICE Futures Group, told the DCNF.
President Joe Biden said during an Oct. 7 speech that he has brought gas down by over $1.60 per gallon and stated that he will continue bringing prices down. The DOE plans to release 10 million more barrels throughout November and the White House stated on Oct. 5 that it was considering new SPR releases due to OPEC’s decision to cut production.
However, White House Press Secretary Karine Jean-Pierre said that the administration was not planning to do so less than a day earlier.
“In the U.S., we are soon approaching the holiday season when transportation fuel demand will drive the refinery crude demand higher in a market with higher crude prices,” Rohit Rathod, a senior oil market analyst at Vortexa, told the DCNF. “The higher crude oil prices along with a general increase in gasoline demand will drive the gas prices at the gas stations higher.”
Leading oil traders told Reuters on Oct. 4 that oil demand has stayed steady despite increasing fears that the world economy is now in recession. High natural gas prices that are being exacerbated by Russia’s invasion of Ukraine could also push countries to switch to oil which could keep oil demand high ahead of winter, according to S&P Global.
“It’s really one of the biggest mistakes the Biden administration has made,” Flynn told the DCNF. “They’ve chosen to go after the oil industry for war profiteering and price gouging while they are canceling pipelines and instituting drilling moratoriums.”
Biden revoked the permitting for the Keystone XL pipeline during his first day in office, a large pipeline that could have transported 830,000 barrels of Canadian oil per day into the U.S, according to the government of Alberta. During his first 19 months in office Biden has also issued the fewest acres of land for federal oil and gas leases since the 1940s, according to The Wall Street Journal.
The White House did not immediately respond to the Daily Caller News Foundation’s request for comment.
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