Biden 'hoping' inflation cools as gas prices fall daily for more than a month

Prices are dipping below $4 per gallon in some parts of the U.S.

July 18, 2022, 5:17 PM

The White House on Monday tried to counter bad news on soaring inflation by highlighting that a key driver of rising prices -- the cost of gasoline -- has been going down steadily for more than a month.

The average American driver is now saving $25 per month at the pump as thousands of gas stations lower their prices to below $4 per gallon, Biden economic adviser Jared Bernstein told reporters at the daily White House briefing.

Although gas prices are dropping below $4 a gallon in 30 states across the country, the national average stood at $4.52 Monday morning, according to AAA.

Down more than 15 cents from the week before, Monday marks 34 consecutive days prices have fallen from the June 14 peak of $5.01 per gallon.

Americans are spending $190 million less per day at current gas prices economy-wide, Bernstein said. That could translate into lower costs for other goods and services for which gas is an input, like transportation, he said.

The White House expects prices will continue falling through the end of July, hoping prices hit $4 nationwide, Director of the National Economic Council Brian Deese said during an appearance on CNN Monday morning.

The White House pointed to the tech website Gas Buddy that monitors prices nationwide as tweeting that the most common gas price in the U.S. was $3.99 a gallon.

When asked in Saudi Arabia last week about his message to Americans looking for relief at the pump, President Joe Biden said, "there's been a real change."

"They've been coming down every single day, to the best of my knowledge," Biden said.

PHOTO: A Chevron gas station is seen, July 5, 2022, in Houston.
A Chevron gas station is seen, July 5, 2022, in Houston.
Brandon Bell/Getty Images

The president's remark came after he met with top members of Saudi Arabia's government. He reportedly sought a commitment from the country to boost its oil production so domestic prices in the U.S. could fall further. But Biden left the Middle East without Saudi Arabia or OPEC+3 countries as a group announcing any new commitments to boost oil production further.

Last month, OPEC+3 announced it would increase July and August production to 50 percent above what it first planned. The White House signaled Monday it anticipates further steps to stabilize the market in the coming weeks.

Saudi Arabia is a member of OPEC+3 with Russia, which the White House has frequently faulted for high energy prices due to the country's war in Ukraine.

Even without securing a commitment from Saudi Arabia, the White House took credit for the price drop on Monday.

"​​This is important to note that the work that we have done, the work that we will continue to do is going to give relief [of] $25 a month to American families," White House press secretary Karine Jean-Pierre said.

"On average, that matters to teachers that matters, the firefighters. That matters to nurses and everyday people. The president is going to continue to do the work to make sure the prices go down," she said.

Relief at the pump comes as oil prices increase slightly compared to where they closed Friday. Oil traded for about $105 per barrel Monday morning, up approximately four dollars from Friday and down from a week ago.

American refineries are operating in the mid-90 percent range, even as gasoline demand has fallen. That mismatch in supply and demand will soon result in a four-million-barrel surplus per day, according to energy analytics firm ESAI Energy.

PHOTO: A general view Tesoro's Los Angeles oil refinery in Los Angeles, Oct. 10, 2014.
A general view Tesoro's Los Angeles oil refinery in Los Angeles, Oct. 10, 2014.
Lucy Nicholson/Reuters, FILE

The U.S. releases one million barrels of crude oil daily from the Strategic Petroleum Reserve.

"I'm hoping," the president said upon his return to the U.S. Saturday night when asked if inflation would fall. The remark followed Wednesday's news that inflation broke projections, rising 9.1 percent in June.

The White House maintains the June report does not account for falling gas prices, which started decreasing halfway through the month.

The Biden administration rejected the idea a recession is imminent Monday, citing a 3.6 percent unemployment rate near pre-pandemic levels and consumer spending.

"Those kinds of statistics are anything but recessionary," Bernstein said. "The president's actions taken thus far are helping provide real relief, real breathing room for the American consumers at the pump," he added later.

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