President Joe Biden’s war against fossil fuels continues to drive oil prices up to $100 per barrel. This will force American consumers to pay the highest gasoline prices in nine years.
Left-leaning media blames inflation and rising gasoline prices for Russian dictator Vladimir Putin’s aggression against neighboring Ukraine. They cite the recent rise in Brent crude oil to $99.50.
Marketwatch covered the story in the same way. Brian Milne, the editor at DTN, made a comment about how Americans will pay more for gasoline. If we don’t see a quick resolution to Brent crude, prices for gasoline in the United States will rise to $3.75 per gallon by March 1.
According to GasBuddy, retail gasoline prices are already in flux. The average national price of regular unleaded gasoline was $3.541 per gallon on Tuesday morning. They are up nearly 21 cents compared to a month ago and 2.1 cents on Sunday. GasBuddy data shows that prices are at their highest level since the summer of 2014. GasBuddy data shows that a move to $3.75 per gallon would bring the cost up to its highest level since March 2013.
According to Patrick De Haan (head of petroleum analysis at GasBuddy), for every $1 increase in oil prices, the average national gasoline price rises by 1.5 cents per gallon. This is assuming base prices of $90/barrel for U.S. benchmark West Texas Intermediate crude and $3.65/gallon for gasoline. He says that motorists would pay for oil if it rose by $5 per barrel in a single trading session. This move is usually completed in 7 to 12 days.
De Haan says that gasoline prices “consistently” remained in the $3 to $3.85 range when oil prices rose to $100 in 2014. He says that gasoline prices averaged $4.10 per gallon in 2008 when oil reached $147 a barrel. But oil didn’t stay high long.
Marketwatch reported that oil supply disruptions would be “key to the outlook for gasoline,” but did not report on Biden’s efforts to stop as much domestic oil production as possible, such as closing the Keystone Pipeline or trying to end oil exploration on public land.
The report also notes that OPEC (including the largest producer, Saudi Arabia) is not responding to Biden’s repeated requests for more production overseas.
Russia is an additional global oil supplier and could retaliate against the imposition of sanctions.
De Haan stated that it’s a “perilous situation that could impact U.S. motorists” and one of the most serious in recent history in terms of possible outcomes being negative. He also said that this could lead to a $5 per gallon national average gas price.