Supply, Demand, and Deflection
Sorting Fact from Friction in Gas Pricing
Gas prices are high now, and the public is correctly aware of who’s responsible. You can see the tactics Republicans are using to try and avoid the well-deserved blame. One is what-aboutism. What about the price spike under Biden’s presidency?
Now, Trump and Republicans also try to just directly lie, suggesting gas prices aren’t high, won’t be high for long, and hey, this was all necessary. That type of lie only works directly with the most deceivable. It may help keep some of them from waking up, but the real purpose of that type of lie is to make the more subtle lie less obvious.
The more subtle lie, equating price spikes under Biden and Trump, doesn’t try to convince the public not to blame Trump and the Republicans for this spike, it tries to convince them to ignore it, suggesting, you still need to vote for us, price spikes would be worse with Democrats.
The reason no one should accept that argument is Biden didn’t cause those spikes. The simplest way to understand how poor the argument is, ask how much oil did the Biden presidency remove from the market? I can tell you, it wasn’t 15% of global supply. Probably not even 1%. I think you’d remember that story if it happened. It didn’t. Instead a different story happened.
When the pandemic occurred, global oil consumption dropped, and prices with it. Producers stopped prioritizing new supply. Later consumers started to return to prior patterns, and producers lagged behind the re-emergence of that demand. The price spike was a simple reflection of that, not a result of any US government policy that removed production.
The two major reductions in production since 2010 occurred under Trump. I wouldn’t blame Trump for the first production drop in 2020. It’s stupid to try and blame presidents for everything. But it also clearly isn’t Biden’s fault.The spike in prices during the rapid period of demand recovery shouldn’t be either.
Having some awareness of who made what choices and why is a better method than just direct association of prices to current governments. Instead it’s obvious the production drop was producers responding to the consumption drop.
Coming back to today, another ounce of blame that is deserved, is the destruction of the US electric vehicle industry, and more generally the entire clean energy industry by Republicans. EV Sales increased by five-fold under Biden, and have stalled/declined under Trump. If you want low gas prices, it helps a lot if your neighbors aren’t using much. Eliminating the $7,500 point of sale credit for these vehicles was a strategic and tactical mistake.
The on-off engagement with renewables is another strategic mistake that’s related. While renewables direct impact on gasoline prices are small, the impacts on batteries flows over into diesel generators and the EV industry. The big strategic failure of on-off engagement has been to fail to develop a valuable industry, allowing China to dominate.
Ultimately, the primary determinant of today’s prices is obvious. Trump’s war and its repercussions.