The House Energy and Commerce Committee is holding a hearing on April 6, 2002 entitled, “Gouged at the Gas Pump: Big Oil and America’s Pain at the Pump.” The fact sheet below is a pre-debunking of the inquisition. Here is a PDF of the fact sheet.
House Hearing: “Gouged at the Gas Station: Big Oil and America’s Pain at the Pump”
Reality: Biden’s Fault, Not the Oil Industry’s
Summary. Gasoline prices have almost doubled since Joe Biden became President. Gasoline prices are high because oil prices are high. Oil prices are high because of post-pandemic demand is outstripping supply. Biden has taken a number of actions to limit and/or discourage increased oil supply. Russia’s invasion of Ukraine has further constrained supply and pushed up oil and gasoline prices. High oil prices cause high gas prices. There is no evidence that the oil industry is “gouging” consumers. Even left-wing economists and media admit this.
Gas prices have almost doubled since Joe Biden became President (Source: Bloomberg/Washington Post). And most of the increase predates the Ukraine invasion.
Gasoline prices depend on oil prices and supply and demand (Source: EIA).
Previous government investigations have turned up no evidence of gouging. “At the urging of President George W. Bush, the FTC investigated price gouging in the wake of Hurricane Katrina, releasing a 2006 report on “Gasoline Price Manipulation and Post-Katrina Gasoline Prices.” President Barack Obama formed the “Oil and Gas Price Fraud Working Group” in 2011… The results have been the same: The number one factor on the price of gasoline is the global price of oil.”
Leftist economics writer and oil industry-hater Doug Henwood. “The graph below makes the point visually. Oil and gas prices move almost exactly together, with gas moving less than oil. A simple regression on these stats shows that for every 10% change in the price of oil over the course of a year, the price of gas moves by about 4.5%. The relationship holds in both directions… And the relationship holds if you take the analysis back to 1975 instead of beginning at 2000.”
Washington Post fact checker. “Every $10 increase in the price of crude oil adds about 24 cents to the cost of each gallon of gasoline and is quickly reflected in what you pay at the pump. It’s not an example of price gouging.”
Boston University prof. “Robert Kaufmann, who studies world oil markets, said there are no shenanigans going on. “Probably not,” said Kaufmann a professor with the Boston University Institute for Sustainable Energy. “The world price for oil is set on several heavily traded exchanges where there are lots of buyers and sellers and they set the price for crude oil.” “Your local gas station can raise the price a little bit above or a little bit below others,” said Kaufmann. But consumers search pretty steadily for the lowest price and if you get too far out of line, people are not going to come to your station. And that even reduces revenues further because a lot of these gas stations depend upon coming in and buying drinks and treats for their revenue, he said. Kaufmann and other oil industry analysts say there is so much competition, retailers can’t really charge what they want.”
Wall Street Journal.
Car and Driver.
Former New York Times Business writer Joe Nocera.
Politifact. “A Facebook post claimed that comparing the price of oil and gas in June 2008 to March 2022 shows that oil companies are ‘price gouging.’ Experts said it takes time for gas prices to respond to drops in crude oil costs, and that’s not necessarily indicative of price gouging. The post’s numbers are cherry-picked; the difference in prices isn’t as great as it suggests… We rate these posts False.”
Biden actions to constrain oil supply, pretend to increase supply or to intimidate oil companies.
- Campaigned against fracking and fossil fuels.
- Cancelled Keystone XL pipeline.
- Halted new oil and gas leasing on federal lands.
- Defied court order to resume leasing.
- Announced release of a paltry 1.5 days of oil from the Strategic Petroleum Reserve.
- Investigates oil companies for price gouging.
- Comptroller of the Currency nominee says she wants to bankrupt fossil fuel companies.
- Asked OPEC, Iran, Venezuela and Saudi Arabia to increase production, but not US producers.
- Asked China to release oil from its strategic reserves.
- Federal Energy Regulatory Commission issues rule to block new pipelines because of climate.
- Falsely accuses oil companies of price gouging.
- Announces release of insignificant 1 million barrels of oil a day from the SPR for up to six months.
- Falsely claimed oil companies are sitting on 9,000 unused leases.
- Has consistently exalted the climate agenda over affordable gasoline.
it’s their standard play when Congress or the Presidunce do something that disturbs the markets and prices shoot up as a result. Jimmy Carter, QED.
The usual dummies will be blaming Big Oil of course.
In brief, the recent rise in the price of gasoline is attributable to the reduction in the supply of petroleum that has been orchestrated by the Biden administration. Biden lies when he attributes this rise to the oil companies.