(The Center Square) – Gas prices have soared to record highs in the past year, and analysts say they likely will only get higher.
According to AAA, the national average gas price is $4.33 a gallon, up from an average of $2.86 the same time last year.
“If current policies now considered by the U.S. and Europe continue, it is likely that global oil and natural gas prices will continue to stay high, and could go far higher,” said Mark Mills, an energy expert at the Manhattan Institute.
“Keeping oil and gas prices down will require signaling to the market that more production is coming on-line in the usefully foreseeable future,” he added.
Recent polling suggests Americans have little hope prices will go down anytime soon. Rasmussen Reports released polling data earlier this month showing that 3 out of 4 surveyed Americans expect to pay even more for gas.
“The latest Rasmussen Reports national telephone and online survey finds that 78% of American adults say they’re paying more for a gallon of gas today compared to six months ago, and 84% think it’s likely those prices will continue to climb over the next six months,” Rasmussen said. “This includes 64% who think it’s very likely they’ll be paying even more for a gallon of gas in six months than they are today.”
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The Biden administration has taken fire for months for its handling of the energy issue. Gas prices steadily increased since Biden ended construction of the Keystone Pipeline and froze new drilling leases on federal lands after taking office, among other policy decisions affecting the oil and gas industry.
Critics have pointed to those actions as missteps and called for more domestic production.
“But until we ramp up production to 2019 levels, we cannot import enough crude to make up the deficit,” said Daniel Turner, head of the energy workers advocacy group, Power the Future. “Foreign oil has a huge price tag with incurred shipping and refining costs. There’s an additional $10-$15 per barrel for crude which comes from tankers, and oil from places like Venezuela are more expensive to refine. None of these solutions will mitigate the ultimate concern which is record-high costs.”
White House Press Secretary Jen Psaki said Monday the administration is trying to mitigate the rising prices but expects “it will continue” to rise.
Higher gas prices make a range of goods more expensive since the cost of transporting those goods to market is passed down at least in part to consumers. With inflation already increasing at the highest rate in decades, Americans are feeling the pinch.
“Record high gas prices are here to stay, and it is only the beginning of the Biden economic disaster headed towards American families,” Turner said. “Food prices: planting, fertilizing, harvesting, processing, shipping are all very energy-intensive industries. We are still eating last year’s crops, but with diesel and fossil fuels costs doubling and tripling the costs to the agriculture industry, we can expect to see crippling food prices.”
Mills compared the Ukraine disruption to the 1973 Arab Oil embargo, which sent gas prices skyrocketing.
“The magnitude of potential supply disruption – whether by sanction, or deliberate cut-off – from Russia is comparable to the scale of disruptions from both the 1973 Arab Oil Embargo, and from the 1979 Iranian Revolution; both those events spiked global oil prices by about 400% and 200% respectively,” he said. “The only short-term options for replacement production at scales comparable to what is at risk (Russian supply) are from Saudi Arabia and the United States. But neither can alone make up the difference in a short time. And for the latter there is no evidence in U.S. policy or administrative actions taken or proposed to suggest the possibility of relief coming from American production.”
Democrats have pushed for renewable energy sources as an alternative to relying on fossil fuels, but critics say the technology is not yet ready.
“And proposals being made to accelerate, or ‘warp speed’ alternative energy to offset Russian oil and natural gas are, to put it undiplomatically, laughable,” Mills said. “There is no chance ‘alternatives’ can make a significant difference for decades.”