Biden and Democrats face strong headwinds in the upcoming midterm elections, while Republicans have focused on inflation and rising costs as they try to convince voters that Biden’s economic policies are hurting their wallets . Polls often show that the economy and cost of living are largely voters’ top concerns.
Biden has largely sought to blame those cost increases on Russia’s unprovoked invasion of Ukraine and the ensuing fuel shortages and supply disruptions. The president has repeatedly referred to the cost increases as “Putin’s price hike,” while other measures are being taken to lower oil prices.
The most prominent of these is the release of a shipment of oil from the Strategic Reserve, which is designed to protect the United States from oil shortages that affect its national security. Since announcing a spring draw of up to 180 million barrels, the White House has released about 165 million barrels of oil from the stockpile, the largest release ever from the stockpile.
This month, OPEC Plus, an alliance of producers led by Russia and Saudi Arabia, announced it would cut oil output by 2 million barrels a day, threatening further price hikes for countries already grappling with high costs. The move has been particularly frustrating to the White House since Biden made a controversial visit to Saudi Arabia in July to strengthen ties.
Biden also lashed out at energy companies, which he said did not lower oil prices when they fell. An administration official who gave reporters background ahead of Biden’s announcement said the companies’ actions “added 60 cents to the average gallon of gasoline and kept gasoline prices higher than they would otherwise be.”
Industry officials responded that the government was picking numbers from its balance sheet, ignoring the long-term picture of corporate losses early in the pandemic. At one point, oil was trading at zero dollars a gallon. Oil executives also warned that a windfall tax on the profits they now earn, as advocated by many Democrats, would exacerbate shortages by discouraging investment in infrastructure and drilling.
Critics, including many Republicans, argue that Biden is misusing the reserves for his own political purposes, rather than limiting its use to a genuine national crisis as intended. But the administration official, who spoke on the condition of anonymity to discuss the move ahead of the official announcement, said there were 400 million barrels left in the SPR.
“It’s still a lot of barrels,” the official said. “It’s a bridge. It’s a longer bridge. It’s an attempt to use this tool in a very responsible way.”
The stockpile is now at a 40-year low, but far from empty. The capacity can hold about 714 million barrels.
Even so, the government’s move has been heavily criticized, in part because gas prices have largely stabilized. The release continued over the summer as pump prices fell for 99 days, below $4 a gallon and remained there.
Critics argued that the government at the time should have started filling the reserves, rather than continuing to draw from them. But people are reluctant to do anything that would put upward pressure on natural gas prices.
After OPEC recently announced production cuts, the government vowed to act to stabilize prices. But before it took any action, prices had stabilized on their own. Natural gas costs fell this week on fears of a looming recession.
The latest move comes against the backdrop of a heated midterm campaign, just three weeks before Election Day.
Biden and his fellow Democrats have struggled to convince voters they are doing the best they can with the economy, while Republicans have cited inflation — especially gas prices — as well as immigration and crime to show the country Chaos is going on under Biden.
The president has sought to shift the focus to abortion rights, voting integrity and the investigations surrounding former President Donald Trump, hoping that large numbers of voters will see the issues as enough to overcome their economic anxieties.
On the economic front, Biden highlighted legislation passed by Democrats to address prescription drug prices, as well as his move to forgive student loan debt.
But senior White House advisers have long argued that their political fortunes in November will suffer. Eighth Congressional elections will largely depend on the rise and fall of gasoline prices.
Biden plans to announce several other moves in addition to the oil release on Wednesday.
He is expected to say the government will buy crude oil as a strategic reserve when prices reach or fall below around $70 a barrel to ensure reserves are replenished and create more certainty for future oil demand.
Additionally, Biden will call on oil companies to pass on lower energy prices to consumers. The White House believes that energy refiners are now making far more profit per gallon of gasoline than they normally would.
Energy Secretary Jennifer Granholm had earlier informed oil companies that the administration was considering a temporary ban on the export of refined fuels such as diesel, with particular shortages in the U.S. in coming months. But so far, the government has not implemented such a ban.
White House press secretary Carin Jean-Pierre tried to highlight during a briefing on Tuesday that while the recent decline in natural gas prices has been broken, the overall trend remains good, with prices down $1.15 from their highs.
“The typical family of two drivers saves about $120 a month at the gas station compared to what we had in mid-June,” Jean-Pierre said. “Americans are saving about $420 million a day compared to mid-June.”
She also noted that gasoline prices are starting to fall again, down 5 cents over the past week, with larger declines in states such as California, Wisconsin and Oregon.
But even though gas prices have stabilized in parts of the country, they remain fairly high in some key battlegrounds, raising the challenge for Democrats in the upcoming election.
In California, which has at least eight contested House seats, gasoline prices remain above $6 a gallon despite recent declines.
In Nevada, where Democrats are at risk of losing their Senate seat, polls show a tight race for governor and a gallon of gasoline costs $5.23.
Even if gas prices don’t rise further between now and Election Day, drivers are likely to suffer more as winter approaches. Europe plans a blanket ban on Russian oil in early December, a move that government officials have long feared would cause a price shock around the world.
U.S. and European leaders hope to mitigate the impact of the ban by placing a price cap on Russian oil, which would allow some of it to continue to enter world markets. But there is no guarantee it will work.