REHOBOTH BEACH, Del. — President Joe Biden said Monday that he’s considering a federal holiday on the gasoline tax, possibly saving U.S. consumers as much as 18.4 cents a gallon.
“Yes, I’m considering it,” Biden told reporters after taking a walk along the beach near his vacation home in Delaware. “I hope to have a decision based on the data — I’m looking for by the end of the week.”
The administration is increasingly looking for ways to spare the public from higher prices at the pump, which began to climb last year and surged after Russia invaded Ukraine in February. Gas prices nationwide are averaging just under $5 a gallon, according to AAA.
Biden said members of his team were to meet this week with CEOs of the major oil companies to discuss rising oil prices. Biden lashed out at oil companies, saying they are making excessive profits when people are feeling the crunch of skyrocketing costs at the pump and inflation. But Biden said he would not be meeting the oil executives himself.
“I want an explanation for why they aren’t refining more oil,” Biden said.
The Biden administration has already released oil from the U.S. strategic reserve and increased ethanol blending for the summer, in additional to sending a letter last week to oil refiners urging them to increase their refining capacity. Yet those efforts have yet to reduce price pressures meaningfully, such that the administration is now considering a gas tax holiday. Taxes on gasoline and diesel fuel help to pay for highways.
The Penn Wharton Budget Model released estimates Wednesday showing that consumers saved at the pump because of gas tax holidays in Connecticut, Georgia and Maryland. The majority of the savings went to consumers, instead of service stations and others in the energy sector.
In an interview Sunday on ABC’s “This Week,” Treasury Secretary Janet Yellen expressed an openness to a federal gas tax holiday to give motorists some relief.
Strolling on the beach with his daughter Ashley, granddaughter Naomi, and his granddaughter’s fiancé, Biden stopped frequently to chat with beachgoers who were spending the Juneteenth federal holiday at the beach.
He took a moment to offer assurances about inflation — the consumer-price index increased to a nearly 40-year high of 8.6% in May from the same month a year ago — and growing warnings from economists that a recession may be around the corner.
“We’re going to get though this, guys,” Biden told one group of beachgoers.
Last week, the Federal Reserve stepped up its drive to tame inflation by raising its key interest rate by three-quarters of a point — its largest increase in nearly three decades — and signaled more large rate increases to come.
Former Treasury Secretary Larry Summers told NBC’s “Meet the Press” on Sunday that in his estimation, “the dominant probability would be that by the end of next year we would be seeing a recession in the American economy.”
Biden said he spoke with Summers, who served as treasury secretary in the Clinton administration, on Monday morning.
“There’s nothing inevitable about a recession,” Biden said.
Associated Press writer Josh Boak contributed from Baltimore.
Gas prices hit $5 national average after rapid rise
The average price of a gallon of gas nationwide exceeded $5 on Thursday, crossing the milestone after a rapid rise over the past month that has alarmed public officials and strained the budgets of everyday Americans, according to GasBuddy.
In all 50 states, the average price of a gallon of gas stood above $4.40, but costs ranged considerably across different regions, as drivers in the West and Northeast suffered the highest prices and drivers in the Southeast saw the lowest, AAA data showed.
In California, the state with the highest gas prices, drivers paid an eye-popping average of $6.40 per gallon, AAA data showed.
The rising prices owe to a summer travel boom that has brought more people to the pump, ABC News reported last month. The spike in demand coincides with a shortage of crude oil supply amid the Russian invasion of Ukraine, which prompted a widespread industry exit from Russia that pushed millions of barrels of oil off the market, the experts said.
As consumer frustration has mounted in recent months, President Joe Biden has faced criticism over his handling of cost increases in essentials like fuel and groceries. Only 37% of Americans approve of Biden’s handling of the economic recovery, according to an Ipsos poll released on Sunday.
Republican leaders in Congress have faulted Biden’s management of the U.S. oil supply for high gas prices, blasting his choice to shut down the Keystone XL pipeline last year.
As of last week, Biden was leaning toward a trip to Saudi Arabia, the world’s top oil exporter, which may offer some hope of relief for U.S. gas buyers.
In March, the U.S. and its allies announced the collective release of 60 million barrels of oil from their strategic reserves over the following months, which sought to alleviate some of the supply shortage and blunt price increases.
Transportation Secretary Pete Buttigieg on Sunday told “This Week” anchor George Stephanopoulos that inflation is Biden’s “top economic priority.”
Stephanopoulos on Sunday asked Buttigieg about the release of oil from the strategic reserves, saying it “hasn’t made any difference at all.” Stephanopoulos asked, “Was that a failure?”
“I don’t think it’s correct to say it hasn’t made any difference at all,” Buttigieg said. “This is an action that helped to stabilize global oil prices.”
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