It’s time for real talk about gasoline prices. It matters why prices are high, who can do something about it, and what they can do about it. Unfortunately, many politicians vow to lower auto fuel prices but have no power or plan to do so. This is especially true of Republicans, who are making dishonest promises about gas prices that they cannot keep.
Consciously or unconsciously, gas prices profoundly impact people’s perceptions of the economy and their behavior in the voting booth. President Joe Biden and the Democrats have seen their fortunes rise and fall this year based mainly on gas prices alone, despite existential issues from abortion to Ukraine to the fate of democracy itself.
Republicans have pinned the pain at the pump on Biden without explaining why, save for griping about a “Green New Deal” that never passed a Democratic Congress. The GOP has no real plans for reducing prices, and its one semblance of vague grunt of an idea, more drilling, would not do anything to lower prices at the pump.
Let’s start with why gas prices are high. The biggest factor is society normalizing after the height of the pandemic. More people are driving. There is usually a summer spike in demand, but after years of postponed vacations, business travel, and road trips to see Grandma, Americans are back in their cars. Higher demand means higher prices. The second most significant factor is Russia’s bloodthirsty invasion of Ukraine, which has led to sanctions and boycotts of Russian energy, as well as Moscow’s apparent sabotage of its own production to punish Europe for supporting Ukraine. (It’s not just the Nord Stream pipeline mysteriously blowing up but lots of questionable “maintenance” slowing the Russian energy flow.) Third, supply chain disruptions and the pressures on international shipping have only added to oil prices. As my Washington Monthly colleague Phillip Longman explains, corporate oil monopolies are using the general environment of high inflation to artificially raise prices and gouge consumers.
There is nothing Republicans can or will do to “fix” this. They have no interest in punishing oil companies for price gouging. By contrast, the Biden administration and California Governor Gavin Newsom are taking steps to hold energy profiteers accountable. What little can be done about increasing the oil supply, the Biden administration is already doing.
More drilling in the U.S. will not do much to help. We’re already the world’s largest oil producer. Oil is sold on a global market, which makes marginal increases in domestic drilling a drop in the proverbial bucket. Besides, oil companies aren’t interested in new drilling. As the corporate accountability nonprofit Food and Water Watch notes:
First, Biden is not blocking the flow of American oil. In fact, he’s opened the tap more than Trump. The current administration issued more than 3,500 drilling permits in 2020 alone; that’s a third more than during Trump’s first year. And under Biden, U.S. oil production has grown from 9.7 million barrels a day to 11.6 million. Yet oil and gas corporations are staying away from new drilling projects. Currently, 4,400 approved and drilled wells have yet to produce oil. Oil and gas executives show no sign of ramping up production.
Why aren’t energy companies rushing to drill more? It’s partly because of pandemic-related labor shortages, but more importantly, oil production is not a growth industry. Any new drilling would take years or even decades to come online. Meanwhile, renewable sources are getting cheaper. The auto industry is rapidly moving to electric vehicles, and just about everything else is going electric, too, from leaf blowers to home heating. Drilling is taking a back seat.
Refining is a much bigger impediment than supply. Our refinery capacity is hurting mostly because many refineries shut down due to a lack of demand during the pandemic. Our refineries are built to handle different types of oil from those most widely available today. Vladimir Putin and OPEC could open the spigots and we still wouldn’t have the refineries to turn fossil fuel into “regular” and “premium.”
Of course, even if Republicans could somehow alter basic chemistry and the laws of supply and demand to reduce gas prices—and they cannot—we still have an urgent climate crisis. It’s causing extremely expensive weather events, damaging our economy, threatening our national security, and imperiling our children’s futures. Moving to renewable energy and reducing emissions isn’t a choice. It’s a necessity. Even oil companies understand this fundamental truth. (They’ve known it for a long time and lied about it, but that’s another matter.) Big Energy and its shareholders know that producing and refining oil into gasoline isn’t a viable long-term business.
So, let’s be clear: Republicans won’t hold oil companies accountable for gouging. If they cut military aid to Ukraine as they intend to, Moscow will have even more power. And Republicans won’t do the most important thing to negate the impact of gas prices on the economy: transition to a renewable future with a livable climate where the fickleness of the global oil market and the whims of Russian and Saudi dictators no longer control our destiny.
Author: David Atkins