Why The Price At The Pump Is So High

If you've been having a stroke every time you have to fuel up, you're not alone. The price of gas has been causing problems for everyone. From its effect on basic consumer goods to what it costs to commute, or go to work if you are in a mobile industry position, the price of gas has everybody rightfully concerned.

Russian oil isn’t the reason for the prices at the pump skyrocketing to never before dreamed levels. It never was. Russian imports of oil accounted for 3% of the U.S. imports. And, gas prices were skyrocketing before the invasion of Ukraine.

“It’s going to go up, can’t do much right now. Russia is responsible.”

— Joe Biden to Fox News when asked about gas. 3–8–22

Using Russia’s invasion of Ukraine as an excuse for gas prices going through the roof and the subsequent effect on the U.S. economy, inflation, and its impact on the citizens of this country was inexcusably weak. Russia wasn't the problem when gas prices began their meteoric rise in the spring of 2021.

Supply and Demand On Gas Prices

In the time period immediately before the pandemic, U.S. oil production was at record highs of 13 million barrels per day. Then came Covid-19 and the demand collapsed. Production of oil soon followed and by May of 2020 production dipped by more than 3 million barrels per day.

As the demand recovered to pre-pandemic levels, oil production has only partially recovered. Information from the (EIA) Energy Information Administration shows current U.S. Oil at just 11.6 million BPD. This shortage in production is a major factor in the staggering rise of gas prices.

With the price of the barrel being what it is, many people question why production hasn’t returned to where it was before the pandemic. The Biden Administration is quick to point fingers at the oil industry. The oil industry says the problem is the hostile anti-energy policies of the Biden Administration.

While the Biden administration is quick to point the finger at the oil industry for not using the permits they have, the reality is that it’s not that simple. Many wells were capped when smaller businesses were forced to shut down due to the pandemic. Oil drilling has increased 60% over the past year but it can take years for a permit to translate into oil production, and that is presuming the location yields oil.

One of the problems with the price of oil is the investors' demands.

“Investors have demanded that producers maintain capital discipline and grow volumes modestly. Returns have taken priority over growth. Up until recently, a producer planning to significantly grow production volumes would likely have been punished by investors. However, that sentiment may be changing with oil prices where they are and the potential need to replace Russian barrels on the global market.”

— Stacey Morris, Director of Research Alerian, Forbes Interview 3–11–2022

Politics On Energy, Oil, And Gas Prices

Biden’s own party is filled with “progressive” democrats that have been on a mission to end fossil fuels but have failed consistently to understand that a transition away from fossil fuels takes time. From the beginning of his presidency, President Biden has had a tentative relationship with the oil companies at best.

“Here’s the situation. And when it comes to the gas prices, we’re going through an incredible transition that that is taking place that, God willing, when it’s over, we’ll be stronger and the world will be stronger and less reliant on fossil fuels when this is over.”

— President Joe Biden, 5–24–22

When the people of this country are struggling to maintain the quality of life that they earned through years of hard work, and many of the struggles are directly attributable to gas prices, there is little doubt that a president seeming to applaud high gas prices leaves many with a feeling of disgust.

On Friday, the national gas price average was reported at $4.715. By June 6th that price is likely to be reported as $5.00 as gas prices jumped again Friday and are now at $5.00 anywhere within driving distance of this area. In just the one day since the report, they’ve already spiked by $4.83.

The policies of this administration have had a correlation with raising gas prices at a time when the world was just starting to come back from Covid-19.

In November of 2021, the EPA announced new rules regarding methane emissions from oil and gas production, transmission, storage, and distribution that cost more than $1 billion a year.

Biden signed a resolution overturning a Trump reform to EPA oil and gas rules. It reestablished regulations that rose the price of gas.

Numbers 3 through 8 are restricting and impeding energy projects. One of Biden’s first administration acts delayed decisions on leases causing higher energy costs for the most vulnerable consumers. The administration canceled the Keystone XL pipeline and suspended oil and gas leases from the Arctic National Wildlife Refuge and New Mexico. It also resurrected the Waters of the United States rule, increasing barriers to energy projects. The White House pursuing new standards for particulate matter and ozone likely tightened them to unachievable levels for much of the country and created new barriers for project permits. The president has rescinded Endangered Species Act reforms, a move that increased red tape and allows litigation to slow down energy projects.

The 9th thing that happened was in April of 2021. Without the consent of Congress, Biden rejoined the Paris agreement, resulting in new regulations that will raise energy costs.

In the 10th instance, the president created several bodies within the White House charged with creating new policies to regulate energy. The people in charge were unelected and didn’t need Senate confirmations, but have round powers to come up with new executive actions to regulate U.S. energy production.

More than one-quarter of the administration-backed Build Back Better agenda is pulled directly from the “Green New Deal.” The agenda includes new taxes on natural gas, home heating, petroleum, and manufacturing. the agenda also spends taxpayer dollars to push utilities to adopt more costly, politically preferred forms of energy, reducing Americans’ energy choices.

Biden Pushes Other Countries To Increase Oil Production

The U.S. was the world’s top oil producer. Yet, President Biden is consistently wooing other countries to produce more oil.

In the U.S. the president campaigned on a platform of transitioning away from oil. Yet, to get prices down, his plan appears to involve oil from around the world rather than right here in the U.S.

On Friday, President Biden had to assure people that he hasn’t changed his view on human rights despite his administration’s praising Saudi Arabia for getting key oil producers to step up production. Yet, as a candidate, he Pledged to make the kingdom of Saudi Arabia a “pariah” over its abuses.

Biden’s administration appears to have chosen to continue with burdensome and troubling regulations in the United States while begging the OPEC+group (OPEC NATIONS plus Russia) to supply the world with the oil needed to hopefully slow a growing, global, economic crisis.

It’s Not Simply Supply And Demand

Gas prices are being controlled by those that are getting richer every day. Gas prices were already predicted to hit $4.00 a gallon before there was the thought of a shot being fired in Ukraine. That alone would be near a 70% increase since this administration took office in 2021.

Decision-makers have fueled the skyrocketing gas prices as investors and big oil have continually reported record-high profits. OPEC has maintained lower production even after the worst of the pandemic. The political decisions in the United States have slowed the return to pre-pandemic levels.

By knowing that oil companies have resisted the need for more production where it is possible, one can only surmise that the biggest cause of the price at the pump being what it is, is greed.

“I don’t know why the prices raised today. We were told two weeks ago that the price would be $4.75 today.”

— Anonymous Fuel Attendant at local station

She was right. As I paid for gas for the first time at $4.75, feeling the pangs of gas nearly doubling in less than two years, gas hikes were being preset at certain places. I knew after that discussion that gas in my area would be $5.00 or greater by the first weekend in June and on June 3rd, it raised to $5.09.