By Jeff Lenard
ALEXANDRIA, Va.—In 2008, the weekly national average gas price was as low as $1.61 and as high as $4.11. That year also featured a bruising presidential campaign with both political parties looking for an edge.
Given that politicians wants to take credit for keeping gas prices in check, or better, lowering them, and everyone running against an incumbent wants to pin blame on the person in charge, it makes sense that President George W. Bush did everything in his power to keep gas prices low.
Yet, prices hit record highs. Was it because of presidential policies, or do presidents have less control over the price per gallon of gas than most people would think?
Going back to 2008, there were concerns that rampant speculation in the financial markets drove up oil prices over the first half of the year. External forces, rather that policymaking, played a huge role affecting supply and demand related to oil prices, which is the biggest factor in the price of a gallon of gas.
Over the past 20 years, other external forces have reshaped the supply and demand equation, including the 9/11 terrorist attacks in 2001, the Iraq War in 2003, Hurricane Katrina in 2005, Arab Spring in 2011, the Saudi Arabia-Russia oil price war that combined with demand destruction from the pandemic to create negative oil prices, to name a few.
Yes, policies and legislation can certainly play a role (whether by a current administration or a previous one), but gas prices are largely dictated by oil prices, and oil prices are dependent upon supply and demand and are subject to world events. Presidential control is not as simple as what those posts suggest on social media.
So, do gas prices tend to be lower in election years, when the most is on the line for the party that is in the White House and wants to stay there? And what about from a legacy perspective? Can presidents say that they reduced gas prices over their term in office?
We fact check the numbers in the latest Convenience Corner blog, “Does the President Control Gas Prices?”
Jeff Lenard is the NACS vice president of strategic initiatives at NACS. He did not attend the Five Minute University but is really good at math. He can be reached at email@example.com.