The average price at the pump is still $1.17 per gallon higher than a year ago. But Democrats are eagerly embracing the changing economic tides — and hoping voters will pay attention.
“We have some really good news: gas prices are coming down,” Biden said at a White House meeting last week. “In some cities, it’s almost a dollar compared to last month. We have worked hard to lower the price.”
It’s an open question, however, whether voters will give more weight to lower fuel prices, or the fact that they rose so high in the first place.
One GOP operative acknowledged that the fallout could make a difference.
“If the market continues to respond the way it has and go back to where it was a year ago, that will definitely dampen the criticism” of inflation, said Chuck Coughlin, a Republican political strategist in Arizona who has experienced some of the worst inflation. high in the country. He said a drop in last year’s fuel prices could “be achieved by early October when early general election votes are cast”.
At the moment, the reduction in energy prices can offer Democrats a break from GOP attack ads on inflation.
The US benchmark oil price is forecast to fall to an average of $90 a barrel for the second half of this year compared to $101.35
in the first half, RBN Energy analyst John Auers said. That would pull gasoline prices lower than they are now, barring a major upheaval in oil markets already shaken by factors including the supply chain crisis and Russia’s war in Ukraine.
“We had some stones thrown into the pond earlier this year,” Auers said in an interview about disruptions in oil markets. “The pile-ups are down, though someone might throw another stone.”
The Biden administration has sought to blame high gasoline prices on Russian President Vladimir Putin and the profiteering of oil companies. But the reasons are more complicated, according to market analysts.
Demand for fuel, which had fallen in 2020 as the Covid pandemic kept people at home, rebounded much faster than oil companies could keep up. The United States and its allies then sanctioned Russia’s oil and financial industries after its invasion of Ukraine, clashing with global energy trade and making oil more expensive.
But oil prices have retreated more than 20 percent since peaking in early June as U.S. crude output rose — helped in part by Biden the administration’s approval of permits to drill on federal land — and amid fears that countries around the globe could slide into a recession that lowers demand for fuel. Russia has also been able to export more of its oil to China and India, keeping the market better supplied than analysts initially expected.
But the White House has also leaned heavily on the idea that the administration deserves much of the credit for the recent price change. of The Treasury Department issued a news release Tuesday praising the release of millions of barrels of oil from the Strategic Petroleum Reserve to help calm markets, saying additional supplies from U.S. and foreign allies’ stockpiles lowered gasoline prices. from 17 to 42 cents per gallon.
“Gas prices have fallen every day this summer so far — consumers are spending about $2 billion less on gas this week than they did in early June. Why?” White House Chief of Staff Ron Klain wrote on Twitter.
Rep. Eric Swalwell (D-Calif.) too took to Twitter to highlight the price slide, despite his state’s residents paying an average of $5.70 per gallon, the highest in the nation. Last week, Sen. King Angusan Independent from Maine, who caucuses with Democrats, challenged the ranking member of the Senate Energy John Barrasso (R-Wyo.) on Republican messaging heading into the fall.
“Gas prices are down 40 cents in the last month,” King Barrasso asked during a commission hearing. “Does the Biden administration take credit for this? Or are they only blamed when they go up?”
Barrasso replied that prices were falling because expenses were causing fewer people to fill their tanks.
“Demand is down not because of Joe Biden,” Barrasso replied. “Demand is down because of people they can’t afford to fill their tank with gas!”
Data from the Energy Department’s independent statistical arm, the Energy Information Administration, show gasoline demand is well below year-ago levels by nearly 8 percent, or more than 700,000 barrels a day.
The more prices fall before Election Day, the better Democrats should feel about their chances, said Jake McCook, a Democratic political strategist in New Mexico, a state with a booming oil industry and below-average gas prices.
“They’ll look at the price a week before or a month before the election and make their decision on that,” McCook said. “I think the Republicans are exaggerating with inflation and gas prices. I don’t think people will buy it. It’s a bit early for him to crystalize in the midfield, but I don’t think this issue will be as number one as people think.”
However, Democrats downplay the issue at their peril, said Republican political strategist David Kochel. Even if the country isn’t technically in a recession, gas prices remain much higher than when Biden took office, and voters are still feeling the pinch of inflation eating away at wage increases.
“Republicans are going to stick to their guns,” Kochel said. “It’s the number one issue before anything else — the price of groceries and gas and the economy in general. [Voters] I know what’s going on with their pockets in this economy.”
Montana Republican Senate. Steve Daineswho is not up for re-election this year, also received the administration’s new messages.
“Now that Biden is claiming $4.32 a gallon gas as a victory for American families, it shows how out of touch he is with reality.” Daines tweeted Tuesday.
And the politics of lowering prices remains complicated even for Democrats. John Fetterman, Pennsylvania’s Democratic lieutenant governor running for Senate in a state that is one of the largest producers of natural gas, sent a press release hours after Klain’s tweet bemoaning the price he and his wife had to pay. to pay to fill their tanks.
“This weekend when Gisele and I were running errands, I stopped to fill up the gas in my Dodge RAM,” Fetterman said in his release. “Cost me $106.86.”
He added: “I see a lot of politicians talk about how gas prices have gone down, but gas in PA is still over $4 a gallon, and these gas companies are still making record profits. We need lower prices now and we need to take action. We need leaders who will suspend the federal gas tax and go after the corporations that are destroying us.”
