CHICAGO (NewsNation Now) — President Joe Biden is strongly considering a plan Tuesday to deal with high gas prices by tapping the strategic petroleum reserves.
Biden is already scheduled to speak Tuesday on the economy and lowering prices for the American people, and may announce his plan then.
In the last year, the average price of a gallon of gas has gone up from $2.12 to $3.40 – a 60.3% increase. Tapping oil reserves is the quickest way to lower gas prices. Sources told NewsNation’s Kellie Meyer tapping the reserves could mean 10 to 30 cents less a gallon at the pump in the next two to three weeks.
It’s one of a few things the administration could do to lower prices, in addition to opening up more federal leases for drilling.
The move, though, could draw backlash from OPEC, the Organization of Petroleum Exporting Countries. The group could turn around and decide not to increase output. If OPEC reacts negatively to the move from the Biden administration, we could see gas prices go back up by Christmas.
It’s not just gas that’s been getting more expensive – the cost of pretty much everything has gone up with inflation, including food.
“We know it’s tough for families to keep up with the rising cost of gasoline, food, housing and other essentials,” Biden said. “It’s not just an American problem. It’s a worldwide problem.”
“My own view is that much of what’s happening in inflation is coming from a supply constraint,” said Austan Goolsbee, former chairman of the Council of Economic Advisers under President Barack Obama. “During the pandemic, people could not spend money on services, which is what we normally spend most of our incomes on, so we’re having record-setting demand for physical goods in the United States and in every other advanced economy of the world, and the supply chain cannot handle that. And that’s why we’re getting inflation.”
Goolsbee believes the inflation is going to be temporary, but is still cause for political concern. Biden is facing dwindling poll numbers over his handling of inflation. “You’d have to be worried on a political front versus on an economic front,” Goolsbee said.
“It’s going to be till next summer before you start seeing relief,” Goolsbee said. “And that’s not really on the political timetable that they’re comfortable with.”