Unless we can get a handle on gas prices, we are going to have an uphill battle in the midterms

[JohnSJ]

Energy cost are driving inflation in every sector

"In the months leading up to the Covid-19 pandemic, U.S. oil production hit an all-time high of just below 13 million barrels per day (BPD). As the pandemic unfolded, demand collapsed, and production followed. By May 2020, oil production had dropped by more than 3 million BPD to 9.7 million BPD.

Since then, demand has recovered to pre-pandemic levels. Oil production, however, has only partially recovered. The most recent data available from the Energy Information Administration (EIA) shows current U.S. oil production at ~11.6 million BPD — still 1.4 million BPD short of pre-pandemic production. This shortfall is a major factor that led to the run-up of oil and gasoline prices over the past year.

When the pandemic crushed oil demand in 2020, some oil companies went out of business. Some small stripper wells — which accounts for a respectable amount of U.S. oil production — were permanently capped given the bleak outlook. Some workers left the oil industry.

Now, with oil prices over $100/bbl, many are questioning why production hasn’t bounced all the way back. The Biden Administration has pointed fingers at the oil industry, stating they have stockpiled 9,000 permits they aren’t using. The oil industry says that the problem — in part — is hostile policies of the Biden Administration.

Setting politics aside, here is what we know. The part about the oil industry stockpiling permits — mostly ahead of President Biden taken office — is true. I have reported on this before. However, that doesn’t mean they are sitting on them."

https://www.forbes.com/sites/rrapier/2022/03/11/what-is-holding-back-us-oil-production/?sh=4db0b6d76b6f

[walkingman]

1. IMO there is no industry more corrupt than fossil fuel companies. I personally

think we should nationalize our energy production but that would go against the religion of GREED.

[JohnSJ]

2. I believe that would require an act of Congress, and in this environment that won't happen

[JCMach1]

3. The oil barons couldn't possibly be manipulating prices for profit and attempting

To defeat the party you have never supported...

That couldn't possibly happen, could it? (Deep sarcasm)

[Ferrets are Cool]

4. Who is we?

President Biden is in a no-win situation.

[JohnSJ]

5. The Democrats. Which I am one

[Ferrets are Cool]

7. You are asking for something that is not feasible.

The free market determines prices. Not Congress. And even if it did, the Democrats do not have the votes to pass legislation of this magnitude.

[JohnSJ]

9. Not quite a free market. but regardless, unless prices come down, the midterms are not going to be

pretty, because we are going to get the blame for it whether justified or not.

[mitch96]

18. As James Carville said:

Open up the oil reserves a month or two before the election? Somehow lower prices in other economic sectors? to help out? I don't know..
m

[AllaN01Bear]

6. this is a deliberate ploy to make mr . biden look bad . greed , greed greed.

[JohnSJ]

8. I agree, and not just the oil industry

[inthewind21]

10. What exactly

do you suggest WE do?

It's right there in you very own post "The oil industry says the problem, in part, is hostile policies of the Biden administration." So maybe Biden should just drop the regulations and let them run completely amok. Would that make you feel better about gas prices? It's hard for me to feel any sympathy when these same poor put upon oil companies are raking in record profits. The only way to not have this be an issue is to have the public actually understand what it going on with gas prices. And the odds of that happening are slim to none.

[JohnSJ]

11. Dropping regulations won't fix this problem. We need something short term, and I would think two

things could be done. Temporarily removing the gas tax, and freezing prices until the situation stabilizes

[inthewind21]

12. Maybe

But you need congress for both. Think Manchin will get on board, along with 10 Republicans?

[JohnSJ]

13. For freezing prices, Nixon did it with an executive order. You are right about the gas tax, which

makes that unlikely to happen, though I believe Congress has been talking about a "gas tax holiday"

which I agree with you, unlikely to happen

[Kaleva]

14. Gas prices will be a bigger issue then a woman's right to choose?

This election will tell us if you are correct.

[JohnSJ]

16. I hope I am wrong, and more people are motivated by the draconian actions of the republicans and the

SC and vote them out

[melm00se]

15. Gas prices,

despite what the Republicans (when the D's are in control), vice versa and anti-oil conspiracists think, are outside the control of any politician.

This is a worldwide market fed by, essentially, oil auctions and by countries who produce oil. The price is driven by the basics of supply and demand.

What makes this market rife for conspiracists is the fact that there are no real substitutes especially as it relates to vehicles. Yes, there are electric vehicles out there but totally electric vehicles are ~5% of the consumer market (and that number is far far lower when you get into the commercial vehicle market).

Before anyone starts pointing at the "record" profits that oil companies collect, it needs to be understood that profits are calculated by subtracting expenses from revenues.

Revenues = For what the goods or services are sold
Costs = What it costs to produce the goods or services.

The real number to look at is net profit (AKA Net Income) as a percentage of revenue (AKA profit margin).

If the profit margin stays the same and the revenue increases, of course profits will be up but if you look at the financial statements (you know, income statements...those documents that accountants produce?), you will see that while inflation increases revenues, inflation also impacts costs.

I was always told that everyone needs a basic grounding in business and accounting and as a young man I blew that off...but I rapidly learned that to be successful in business you need to know what levers affect what financially. Need to be a CPA? no. Know enough to interpret a balance sheet and income statement? Abso-fricking-lutely.

[Chainfire]

17. It is all politics.

Big business trying to put Democrats out of power. The wonderful thing for the oil companies is it requires no sacrifice, in fact they are reaping record profits. It is time to nationalize the industry as vital to the security of the nation. Drug makers should be right behind them.

[Samrob]

19. You don't believe this is a controlled attack on the Biden adm and the Dems?

Just look at who supported Trump here and abroad especially the oil producing tyrants.

[Greybnk48]

20. Exactly! n/t

[JustAnotherGen]

21. I do

But Joe Blow Low Info Voter doesn't care.