FACT BRIEF

Are recent actions by the Biden Administration driving rising gas prices?

Thursday, October 21, 2021

By Austin Tannenbaum

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Oil policies enacted under Biden are not driving the current spike in gas prices. Instead, the coronavirus pandemic is principally responsible.

During last year's quarantine, oil demand plummeted as businesses closed and individuals sheltered in place. In response, OPEC and its allies cut production to prevent a price collapse. Parallel to this, pandemic lockdowns disrupted oil-industry supply chains.

Oil suppliers thus struggled to meet a rebounding demand spurred by the lifting of pandemic-related restrictions earlier this year. When demand exceeds supply, prices rise.

Energy experts Mark Finley and David Dismukes told USA Today that Biden policies such as halting Keystone XL and blocking new federal-lands drilling are not impacting current oil prices given that these projects were never operational. However, because the policies detract from future supply, the two agree that they could have a long-term impact on prices.

This fact brief is responsive to conversations such as this one.

Sources

Reuters OPEC, Russia approve biggest-ever oil cut to support prices amid coronavirus pandemic

GlobalData Plc COVID-19 pandemic has considerably disrupted oil and gas supply chains, says GlobalData

World Bank The oil market outlook: Lasting scars from the pandemic

USA Today Fact check: Rising gas prices due to high demand and low supply, not Biden's policies

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