Gas prices rise; Russian oil enters the U.S.; Biden admin does little

Gas prices in the United States continue to rise, putting a squeeze on the profits of Americans every time they fuel their vehicles.

According to AAA, oil prices on Wednesday rose to $110.60 per barrel, the highest price since 2010. They report that the national average price per gallon of gas on March 3 was $3.72 per gallon. While, in the latest report from the organization, oil supplies dropped slightly, gasoline supplies increased. The average has since risen to $3.92 per gallon.

Source: AAA

Shell buys Russian oil.

Shell Corporation issued a statement after sources pointed out that the international energy giant has purchased oil from Russia. The company bought a tanker full of Urals oil from the Russian company, Trafigura Group.

The British company said in a statement on Saturday: “We will continue to choose alternatives to Russian oil wherever possible, but this cannot happen overnight because of how significant Russia is to global supply. We have been in intense talks with governments and continue to follow their guidance around this issue of security of supply.”

Russia supplies 8-10% of the world’s oil supply, third behind the United States and Saudi Arabia.

Biden and Oil Wells

The Biden administration found itself on the defensive when asked why the United States is not opening up more lands to oil and gas. While they pointed out that there are nearly 10,000 leases that aren’t being worked, they offered no concrete steps to reducing the cost of gas at the pump for millions of Americans.

In his State of the Union address, President Biden mentioned the high gas prices and offered no concrete solutions to the high gas prices.

Under Presidents Obama and Trump, Oil production rose to where, in 2019, the United States became a net exporter for the first time since the 1950s.

Biden’s short-term fix

Amid a crisis created by Russia's attack on Ukraine and rising post-COVID demands, the Biden administration has only offered a short-term fix, releasing oil from the strategic oil reserve. But unfortunately, this type of action will only supply a few days of oil for the United States and rarely affects the pump.

Congress offers a solution.

In an article in The Hill, Representative Gus Bilirakis (R-FLA.) detailed legislation being considered in Congress now that would force the Biden administration to open federal lands to more oil production, identify energy security risks, and open liquid natural gas exports to help move the natural industry.

"President Biden said something else during his State of the Union Address that I strongly agree with," Bilirakis writes. "We can and must be willing to buy products that are made in America. Why would this mindset not also extend to our energy production? Doing so will help American consumers get relief at the pump, while sending the strongest possible message to Putin and our other adversaries that the U.S. is serious about defending Ukraine and holding Russia accountable for its hostile intransigence. We simply should not be filling Putin's war chest when we can produce energy here in the U.S."

Dealing with exports of oil

While looking to the president is important, many are also looking at U.S. companies to lead the way. Many oil and gas companies cut production during the COVID-19 pandemic because of softening demand. Unfortunately, neither Congress nor the Administration has made a full-throated appeal to those companies to open up production widely to lower prices in the United States.

One action that is only talked about on Twitter and Facebook, but not in the halls of Washington, DC, is cutting oil exports until energy prices go down here in the U.S. This can be done by imposing a temporary export tax on energy products to make selling the product here in the U.S. the more profitable option.

Billy Mosley, The Kentucky Daily Lead Reporter

You've successfully subscribed to The Kentucky Daily
Great! Next, complete checkout for full access to The Kentucky Daily
Welcome back! You've successfully signed in.
Unable to sign you in. Please try again.
Success! Your account is fully activated, you now have access to all content.
Error! Stripe checkout failed.
Success! Your billing info is updated.
Error! Billing info update failed.