As the invasion of Ukraine by Russia started, President Joe Biden told the American public that gas prices would rise. Americans were not happy to hear the news as inflation was already a top concern, but we understood there was the literal price to pay for helping defend a democracy.
In the days after the sanctions were announced, the price of oil skyrocketed. It reached its apex of about $125 a barrel on March 9. But since then, the price has declined to $98 at the end of last week, according to Bloomberg, L.P.
That is not the case for gas prices at the pump. Gas prices have not declined at the same rate. A gallon of is currently $4.25 in North Jersey according AAA; a month ago just before Russian entered Ukraine it was $3.60.
But as the chart shows, the correlation of prices dips has not been the same. And gas prices are the ultimate pocketbook issues in North Jersey.
This is just not a gas price issue—this is one that affects supply chain problems we have chronicled since late last year. Prices for goods will rise as it costs truckers more for gas and those prices will be passed onto the Amercians consumer at the register.
So what can be done? Plenty.
First, oil companies should be shouldering the same pain that every American is being asked to do. Rep. Bill Pascrell drove the point home recently when he noted in the first three quarters of 2021, the 24 top oil and gas companies around the world made a combined $174 billion in net income. During that same time period, the average retail gasoline prices have steadily risen from around $2 per gallon in December 2020 to approximately $4.10 per gallon in March 2022.
Representatives of these companies should be in front of Congress justifying their inactions to decrease the price at the pump and what pressure is being put on local gas station owners to prevent price gouging.
But we do not come to bash and penalize the oil industry. The U.S. government should be doing everything it can to increase domestic production to pre-pandemic levels. The U.S. has gone from nearly 13 million barrels of oil a day in 2019 to 11.2 million barrels last year. Regulators should be working with the oil industry to utilize existing leases and permits, so that oil and gas production can meet current demand. And President Biden should release more from the Strategic Petroleum Reserve.
While environmentalists may balk at this—we note that the U.S. is the most environmentally friendly nation when it comes to extracting oil from the Earth—we echo Rep. Josh Gottheimer’s sentiments that we can do both. The U.S. needs to continue its push for alternative energies and accelerate electrical vehicle infrastructure that was approved in the Bipartisan Infrastructure Bill. Increasing oil production and investing in green energy is key to lessening our dependence on foreign oil from nations such as Russia, Iran, Saudi Arabia and Venezuela that do not share our values.
There is opportunity amidst this world crisis for the U.S. to reset our energy policy. Short term actions to increase oil production can and should be paired with long-term goals focusing on climate-friendly energy sources such as wind and water.
North-JerseyNews.com is founded on the belief of both sides working together for solutions that work best for all of us. In this case, its private sector and the government, oil companies and environmentalists that must reach across their prospective aisles to help the U.S. gain energy independence and help Americans at the pump today.