Politics and Gas Prices Redux: “Obama Has Doubled the Cost of Gas”?
Posted by mattusmaximus on April 17, 2012
As a brief follow up to my recent post titled Gas Prices and Politics: Fact vs. Fiction, I wanted to pass along some deeper analysis that my fellow skeptical blogger Phil over at Skeptic Money did. It puts a bit more meat on the bones of my previous argument that (duh!) the President of the United States actually has very little power to affect the price of gasoline at the pump. Read on…
Blog idea from The Skeptical Teacher. [That's me :)]
This is one of the new right-wing talking points. The interesting point is that it’s true. Well, the part that the cost of gasoline going up. However, Obama had nothing to do with it.
“Gas prices since Obama took office have risen by 103.79 percent. No other presidents in recent years have struggled as much with soaring oil prices.” – US News
Here is a graph from DShort.com.
Notice the green line. It is the price of oil. In 2008 while the recession was going strong the price of oil was bid up to almost $150 per barrel by crazed speculators. When the speculators faced the fact of decreased demand due to a global recession the price of oil collapsed to around $40 per barrel. The result is a dramatic drop in the cost of all things that come from oil – including gasoline.
Obama took office on January 20, 2009 at the very bottom of the price drop. Many countries are doing much better now than in 2008-9 and global demand has increased.
Just the other day someone told me that the price of oil was going up because Obama was limiting the production of oil. I thought he was full of crap so I went and searched out the facts for myself. If you ever want data on energy production go to eia.gov.
I found this specific data that shows US Crude Oil production. In 2008 (The year before Obama became president) the US produced 4,950,000 barrels per day. In 2011 the US produced 5,659,000 barrels per day. An increase of 14.3%.
They also claimed that Obama has reduced off shore drilling in the Gulf of Mexico. In 2008 The US produced 1,152,000 barrels per day and in 2011 it was 1,318,000. Wrong on both accounts.
Their third claim was that more off shore drilling would reduce the cost of gasoline and maybe back to what it was 3 years ago. The US produced 5,659,000 barrels per day in 2011 and 23% (1,318,000 / 5,659,000) from the Gulf. US oil production is about 11.6% of the worlds total oil supply. If the Gulf is 23% of this total and you doubled this amount (this could take 10-20 years) then that would increase world production by less than 3%. I’m sure that this hypathetical and dramatic increase would lower the cost of gas. However, I would guess by $0.10 to $0.15 per gallon. [emphasis added]