May 22, 2024 - Energy & Environment

Biden admin to sell gas in bid to tame prices ahead of summer — and election

The line chart shows the average U.S. gasoline price per regular gallon from May 12, 2014, to May 20, 2024. The data indicates a general upward trend in gasoline prices over the decade. Prices began at $3.67 a gallon, but dropped quickly and fluctuated between $1.70 and $3.00 till May 2021, when it hit $3.03. It rose further and it $5 in 2022, but dropped back down. On May 20, 2024, it was $3.58.
Data: EIA; Chart: Axios Visuals

The White House is hoping to squeeze political mileage out of a mandated gasoline sale from a federal stockpile.

Why it matters: Pump prices will rise on the political radar as Memorial Day launches summer driving season — and the election looms.

Driving the news: The Energy Department on Tuesday said it will sell 42 million gallons from the Northeast Gasoline Supply Reserve.

  • The sale this fiscal year, and closure of the reserve, are required under the bipartisan spending deal in March.
  • DOE said deliveries would occur by the end of June.

The big picture: Biden officials made a pocketbook pitch for the sale the White House supported in the budget process.

  • "The Biden-Harris Administration is laser focused on lowering prices at the pump for American families, especially as drivers hit the road for summer driving season," Energy Secretary Jennifer Granholm said in a statement.
  • The release between Memorial Day and July 4 will ensure "sufficient supply flows to the tri-state and northeast" as "hardworking Americans need it the most."

What they're saying: "Today's solicitation seems to make little secret of political intent," ClearView Energy Partners said in a note.

Reality check: Market participants in March were split on how big an impact it would have on prices, per S&P Global.

  • The reserve is very small relative to overall U.S. demand.
  • ClearView notes it's worth less than a day of consumption in targeted markets.

Catch up quick: The NGSR was authorized in 2014, in response to 2012's Superstorm Sandy, which interrupted Northeast fuel and power systems.

What we're watching: If it has any effect on regional prices — and U.S. voters' perception of Biden.

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