Energy
Friday, April 19th, 2024 6:33 pm EDT
Key Points
- National Economic Advisor Lael Brainard assures that the White House will ensure gas prices remain affordable for American families during the summer driving season, hinting at a possible use of the Strategic Petroleum Reserve (SPR) if necessary.
- Gasoline futures have surged nearly 29% this year, with pump prices averaging $3.67 a gallon, driven by factors such as stronger demand, OPEC+ production cuts, and geopolitical risks in the Middle East and Eastern Europe.
- Concerns about escalating tensions in the Middle East, exemplified by Iran’s air assault on Israel and Ukraine’s drone strikes on Russian oil refineries, have intensified worries about crude oil supplies. The Biden administration is closely monitoring geostrategic risks and may consider tapping into the SPR, especially if gasoline prices approach $4 per gallon. Despite recent oil price pullbacks, uncertainties persist, with oil prices above $90 a barrel posing challenges for the broader market and potentially impacting inflation and reelection prospects for incumbents.
President Joe Biden’s top economic advisor, Lael Brainard, addressed concerns about rising gas prices, stating that the White House will ensure gas prices remain affordable for American families, particularly as the summer driving season approaches. Gasoline futures have surged nearly 29% this year, with current pump prices averaging $3.67 per gallon. Factors contributing to this increase include stronger demand, OPEC+ production cuts, and geopolitical risks in the Middle East and Eastern Europe. Brainard emphasized the administration’s vigilance in monitoring international oil markets and domestic gas prices, aiming to keep gas prices stable. Concerns about potential disruptions in oil supplies due to Iran’s recent air assault on Israel and Ukraine’s drone strikes on Russian oil refineries have heightened geopolitical tensions. White House climate advisor John Podesta affirmed Biden’s commitment to ensuring gasoline affordability, mentioning the past use of the Strategic Petroleum Reserve (SPR) to alleviate price pressures. In 2022, 180 million barrels were released from the SPR amid surging oil and gas prices following the Russian invasion of Ukraine. The SPR, currently holding about 365 million barrels, faces criticism from Republicans in Congress for its low levels. Russia’s decision to deepen oil production cuts could exacerbate price pressures, with JPMorgan warning that global benchmark Brent crude oil prices could approach $100 per barrel by September. If gasoline prices near $4 per gallon, there’s a likelihood of another SPR release, as suggested by JPMorgan. Despite recent oil price pullbacks, uncertainties persist, with oil prices above $90 a barrel posing challenges for the broader market and potentially impacting inflation and reelection prospects for incumbents.
For the full original article on CNBC, please click here: https://www.cnbc.com/2024/04/18/white-house-will-make-sure-gas-prices-remain-affordable-biden-advisor-says.html
