Gas Trends Show Obama Isn’t To Blame For Higher Gas Prices

Gas Prices Collapsed During The Recession, And Began To Rise Again Just Before President Obama Took Office. Below is a chart of Energy Information Administration data on average pump prices for a gallon of gasoline since 2006:

[EIA.gov, accessed 2/23/12]

U.S. Gas Prices Have Followed The Same Trend As Global Gas Prices. The following graph from the New York Times illustrates the price per gallon of gasoline in the United States, Britain, Germany, and France between 1996 and October 2011:

[New York Times, 3/17/12]

Domestic Policy Has Little Impact On Gas Prices

Gas Prices Are Determined By Global Markets. From the Wall Street Journal: “U.S. gasoline prices, like prices throughout the advanced economies, are determined by global market forces. It is hard to see how Mr. Obama’s policies can be blamed. […] When Mr. Obama was inaugurated, demand was weak due to the recession. But now it’s stronger, and thus the price is higher. What’s more, producing a lot of oil doesn’t lower the price of gasoline in your country. According to the U.S. Energy Information Administration, Germans over the past three years have paid an average of $2.64 a gallon (excluding taxes), while Americans paid $2.69, even though the U.S. produced 5.4 million barrels of oil per day while Germany produced just 28,000.” [Wall Street Journal, 3/10/12]

Energy Information Administration Head: “Globally Integrated Nature Of The World Oil Market” And Influence Of OPEC Means That Domestic Oil Drilling “Not Have A Large Impact On Prices.” At a hearing of the House Committee on Natural Resources, Richard Newell, Administrator of the U.S. Energy Information Administration, testified: “Long term, we do not project additional volumes of oil that could flow from greater access to oil resources on Federal lands to have a large impact on prices given the globally integrated nature of the world oil market and the more significant long-term compared to short-term responsiveness of oil demand and supply to price movements. Given the increasing importance of OPEC supply in the global oil supply-demand balance, another key issue is how OPEC production would respond to any increase in non-OPEC supply, potentially offsetting any direct price effect.” [EIA.gov, 3/17/11]

Gas Price Expert: Speculators Are Driving Current Rise In Gas Prices. From Businessweek: “Strangely, the current run-up in prices comes despite sinking demand in the U.S. ‘Petrol demand is as low as it’s been since April 1997,’ says Tom Kloza, chief oil analyst for the Oil Price Information Service. ‘People are properly puzzled by the fact that we’re using less gas than we have in years, yet we’re paying more.’ Kloza believes much of the increase is due to speculative money that’s flowed into gasoline futures contracts since the beginning of the year, mostly from hedge funds and large money managers. ‘We’ve seen about $11 billion of speculative money come in on the long side of gas futures,’ he says. ‘Each of the last three weeks we’ve seen a record net long position being taken.’” [Businessweek, 2/14/12]

GOP Economist Holtz-Eakin In 2011: Rising Gas Prices Were “Inevitable” Component Of Recovery From “Massive Global Recession.” On CNN’s State of the Union in March 2011, Republican economist and former Congressional Budget Office director Douglas Holtz-Eakin said: “I think there are three lessons on the oil and gas front. Lesson number one is we have oil at $140 a barrel in 2008. And it went down not because we somehow discovered a lot more oil. No, it went down because we went into a massive global recession. As economies recovered, it was inevitable that prices were going to rise. And this was utterly foreseeable. Second piece is that Libya’s not really the concern. That’s not what markets are pricing. It’s the broader Middle East. Libya is 2% of oil supplies. That’s not our problem. It’s what happens in the rest of the Middle East. And the third is, something like this is always going to happen. There is always some piece of bad news out there. So, the key should be to build an economy that’s growing more robustly, it’s more resilient to bad news that inevitably will happen.” [State of the Union, 3/27/11]

Oil Production And Exports Have Increased Under President Obama

U.S. Crude Oil Production Is At Its Highest In A Decade. According to the Energy Information Administration, U.S. field production of crude oil in May 2012 (the latest data available) was 194,227,000 barrels, and it has been over 180 million barrels per month in every month since October 2011. Prior to October 2011, the last time monthly oil production was over 180 million barrels was in March 2003. [EIA.gov, 7/30/12] 

Domestic Liquid Fuel Production Is Higher Than At Any Point During The Bush Administration. The following New York Times graphic illustrates the amount of crude oil and other liquid fuels produced during the Bush administration and the Obama administration, in millions of barrels per day:

 

[New York Times, 3/17/12]

Under Obama, Oil Exports Are At Their Highest Ever. According to data from the U.S. Energy Information Administration (EIA), 110,028,000 barrels of oil were exported from the U.S. in December 2011, the highest number the EIA has in its records. Exports in May 2012, the latest data available, remained higher than at any point prior to the start of the Obama administration at 98,999,000 barrels. The following graph from the EIA depicts the monthly exports of U.S. exports of crude oil and petroleum products since 1981:

 

[EIA.gov, 7/30/12]

The Proportion Of Foreign Oil U.S. Uses Has Fallen Under Obama

America Uses A Smaller Proportion Of Foreign Oil Than At Any Time During The Bush Administration. The following New York Times graphic illustrates the percent oil consumed in the U.S. that is foreign oil:

[New York Times, 3/17/12]

High Spending On Foreign Oil Is Due To Rising Oil Prices Worldwide, Not Because We’re Buying More. From FactCheck.org: “The price of oil is set on the world markets and influenced by world events. For example, the U.S. buys no oil from Iran but world markets have pushed prices up in response to Iran’s threat ‘to close the Strait of Hormuz, through which passes some 35% of the world’s oil exports,’ as Daniel Yergin, chairman of IHS Cambridge Energy Research Associates, wrote in a March 15 op-ed in the Wall Street Journal. Similarly, the U.S. buys very little oil from Libya (just one-half of 1 percent of all U.S. imports in 2010), yet gasoline prices here spiked when fighting broke out between government and opposition forces. So, the U.S. is spending more on foreign oil because the price of a barrel of oil is going up — not because the U.S. relies more on foreign oil.” [FactCheck.org, 3/16/12]

Total And Net Imports Have Dropped Under Obama. From FactCheck.org: “In fact, the percentage of oil the U.S. imports — both total imports and net imports (after exports are subtracted) — have fallen each year under Obama. Total imports have dropped from 66.2 percent in 2008 to 60.3 percent in 2011, while net imports have declined from 57 percent in 2008 to 45.1 percent in 2011 — the lowest since 1995.” [FactCheck.org, 3/16/12]

Crossroads Relies On Slippery Sourcing

The ad’s statement that “His own administration admits production’s down where Obama’s in charge” is accompanied by on-screen text that says “Oil production fell by 14 percent…on federal lands and waters,” citing an article from Greenwire on March 14, 2012.

Greenwire Specifies That 14 Percent Decrease Referred To 2011 Alone. According to Greenwire: “Oil production fell by 14 percent in fiscal 2011 below the previous year on federal lands and waters, according to statistics provided last month by the Interior Department.” [Greenwire via RLCH.org, 3/15/12]

FactCheck.org: Oil Production On Federal Land Increased By 15 Percent In 2010. According to FactCheck.org: “[P]roduction on federal lands fell by 14 percent in fiscal year 2011 (after a 15 percent increase the year before). But overall, oil production on federal lands saw an increase of 1 percent during the last five fiscal years.” [FactCheck.org, 4/3/12]