In spite of recent claims from some GOP presidential contenders that increasing domestic drilling will lower gas prices, history seems to show more drilling does not automatically mean lower prices (AP) at the pump, according to a statistical analysis of thirty-six years of monthly gasoline prices and U.S. domestic oil production conducted by the Associated Press. In fact, U.S. oil production has increased 15 percent since 2009, but prices continue to rise.
And numerous experts will tell you the United States doesn’t consume petroleum products in a vacuum. Instability in producing countries and high demand from emerging economies such as China also contribute to price increases. “The reality is that oil supply concerns in Iran, Nigeria, and other trouble spots married with heightened oil demand in China, India, and other burgeoning nations will largely determine what Americans pay for gasoline,” writes Deborah Gordon in US News and World Report.
GOP candidates have continuously pointed to what they say are regulatory obstacles, that hurt new production such as offshore moratoriums and delay of the Keystone XL pipeline, as being at least partially at fault for rising energy prices. President Obama, meanwhile, has attempted to highlight his record on oil and gas production.
For more on the candidates’ stances, check out CFR’s Issue Tracker on The Candidates and Energy Policy.
Suggested Other Reading:
In this CFR roundup, five experts offer a range of do and don’ts on how the U.S. government should respond to oil price volatility.
CFR’s Michael Levi says in a recent blog post that releasing oil from the strategic reserve as means to control prices could backfire. “Once government decides to make handling price volatility a public, rather than private, job, it needs to be fully committed to sticking with that program, wherever that leads,” he writes.
The Washington Post’s Ezra Klein argues that no matter what candidates say about gas prices, having them driven up by instability in the Middle East holds back the U.S. economy.
Rick Newman, chief business correspondent for US News and World Report says if there is a conflict with Iran, depending on the timing, it could “upend American politics” because, if gas prices are still high in November, President Obama faces tough reelection odds.
This CFR Backgrounder looks at what contributes to gas prices.
–Contributing Editor Gayle Putrich and Senior Editor Toni Johnson