'Economically illiterate': Bezos and others bash Biden for blaming gas stations for high gas prices, Chinese state media applauds the president
President Joe Biden was taken to task over a recent tweet where he blamed gas stations for sky-high fuel prices. While Amazon founder Jeff Bezos was critical of President Biden's latest scapegoat for record gas prices, Chinese state media applauded Biden for realizing "that capitalism is all about exploitation."
President Biden demands gas companies lower prices
Less than two weeks ago, President Biden demanded oil companies lower their gas prices.
"To the companies running gas stations and setting those prices at the pump, this is a time of war, global peril, Ukraine. These are not normal times. Bring down the price you are charging at the pump. Do it now," Biden commanded.
\u201cBiden: "To the companies running gas stations and setting those prices at the pump, this is a time of war, global peril, Ukraine. These are not normal times. Bring down the price you are charging at the pump. Do it now."\u201d— Greg Price (@Greg Price) 1655921679
President Biden doubled down on his directive for gas companies to lower prices with a tweet on Saturday.
"My message to the companies running gas stations and setting prices at the pump is simple: this is a time of war and global peril," the tweet said. "Bring down the price you are charging at the pump to reflect the cost you’re paying for the product. And do it now."
\u201cMy message to the companies running gas stations and setting prices at the pump is simple: this is a time of war and global peril. \n\nBring down the price you are charging at the pump to reflect the cost you\u2019re paying for the product. And do it now.\u201d— President Biden (@President Biden) 1656777600
Gas industry experts tell a different story
According to the National Association of Convenience Stores, "Only about 0.1% of the fueling outlets in the country are owned by a major oil company." NACS stated that 62% of U.S. gas stations are owned by an individual or family who only operates a single retail gas location.
NACS also noted that gas stations make a "10- to 15-cent profit" on a gallon of gas.
NBC News reported, "Station owners make most of their profits in their stores, on sales of food and drinks, as well as alcohol where sales are legal."
Twitter Reactions to President Biden blaming gas stations
Commentators quickly called out the president for not taking responsibility for record gas prices while assigning guilt to gas stations, Vladimir Putin, former President Donald Trump, and the COVID pandemic.
Congressional candidate Robby Starbuck:
\u201c@POTUS This is you Joe. \u2b07\ufe0f\u2b07\ufe0f\u2b07\ufe0f\u201d— President Biden (@President Biden) 1656777600
Entrepreneur Patrick Bet-David: "First the White House blamed Trump. Then COVID. Then Putin. Then Oil companies. Now gas station owners. What’s next, blaming car owners for driving too much?"
Sen. Ted Cruz (R-Texas): "My message to the guy running your teleprompter: It’s YOUR fault. Reverse the dozens of executive orders, regulations & agency actions targeting American energy, and gas prices will fall…FAST."
Journalist Erielle Davidson: "The market sets the price at the pump, not the gas stations. How are you this economically illiterate. How."
"Fox & Friends" host Brian Kilmeade: "Maybe if u met with the oil executives last week instead of the Wind theorists u would know they are not at fault, your policies are- and here’s the best news, you can still change them & help the country."
Novelist Walter Kirn: "I grew up working in gas stations. They aren’t predatory money machines. Can’t afford to be due to intense competition, because there’s usually another one just down the block — whose prices are posted on a big sign for all to see. What silly amateur condescending bulls**t."
Former FCC Chairman Ajit Pai:
\u201cYesterday / today\u201d— Ajit Pai (@Ajit Pai) 1656785984
Jeff Bezos slams the Biden administration
Bezos – the owner of the Washington Post – denigrated the Biden administration for pointing the finger at energy companies for high gas prices.
"Ouch. Inflation is far too important a problem for the White House to keep making statements like this," Bezos wrote on Twitter. "It's either straight ahead misdirection or a deep misunderstanding of basic market dynamics."
\u201cOuch. Inflation is far too important a problem for the White House to keep making statements like this. It\u2019s either straight ahead misdirection or a deep misunderstanding of basic market dynamics.\u201d— Jeff Bezos (@Jeff Bezos) 1656812537
Commentators note that Bezos has 'buyer's remorse'
Former NSA contractor Edward Snowden simply said, "Buyer's remorse."
Former acting Director of National Intelligence Richard Grenell bashed Bezos, "Tell this to your own newsroom! YOU are part of the problem. Republicans should never help you….or your work ways."
Columnist Derek Hunter also mocked Bezos, "You should try reading the Washington Post, Jeff. There isn't anyone there who understands or respects how markets work either. Know anyone who could change that?"
Actor Rob Schneider: "When you lose liberal billionaire/Washington Post owner Jeff Bezos, you have lost the ideological war. If the Biden administration is out of touch with Billionaires, imagine how the average American worker feels…"
Biden garners support from Chinese state media
Chen Weihua – EU bureau chief of the state-owned China Daily newspaper – wrote on Twitter, "Now US President finally realized that capitalism is all about exploitation. He didn't believe this before."
\u201c@POTUS Now US President finally realized that capitalism is all about exploitation. He didn\u2019t believe this before.\u201d— President Biden (@President Biden) 1656777600
Biden previous said record gas prices were part of an 'incredible transition'
In May, President Biden proclaimed that record-high gas prices are part of an "incredible transition" that will make America less dependent on fossil fuels.
“When it comes to the gas prices, we’re going through an incredible transition that is taking place that, God willing, when it’s over, we’ll be stronger and the world will be stronger and less reliant on fossil fuels when this is over,” Biden declared during a joint press conference with Japan Prime Minister Fumio Kishida in Tokyo.
JPMorgan analysts say you'll be paying $6 per gallon for gas this Summer
As the average price for gasoline reached $6 per gallon in California on Tuesday, analysts at JPMorgan are warning that price could be the norm everywhere in the country by the end of summer.
The national average price of gas is now at a record high of $4.57 per gallon, according to the American Automobile Association. That number is a 16 cent increase from the average last week, a 48 cent increase over last month, and nearly $1.50 more expensive than the national average last year, which was $3.04. Every state now has an average gas price above $4 per gallon, with Georgia, Kansas, and Oklahoma catching up to the rest of the country as of Tuesday.
Prices are expected to continue to rise as the ongoing war between Russia and Ukraine disrupts international supply chains while at home, the Biden administration has canceled oil and gas lease sales. With more Americans expected to travel for work or vacation over the summer, a likely increase in demand for gas could push prices up even higher.
"There is a real risk the price could reach $6+ a gallon by August," JPMorgan analyst Natasha Kaneva told CNN on Tuesday. JPMorgan predicts that prices could soar another 37% by August as East Coast gasoline inventories have reached their lowest level since 2011.
U.S. and Canadian oil refineries took a hit during the pandemic, with some closing permanently and others being converted to refine renewable fuels instead of crude oil, CNN reports. The war in Ukraine is exacerbating the problem by heavily restricting the supply of gas available to European countries that have relied on Russia for oil, which has led to increased demand for U.S. and Canadian exports.
The shift in focus to exports has diverted U.S. and Canadian refineries from supplying Eastern U.S. gas stations, according to JPMorgan's analysis.
"If exports persist at this elevated pace and refinery runs -- already near the top range for reasonable utilization rates -- fall within our expectations, gasoline inventories could continue to draw to levels below 2008 lows and retail gasoline prices could climb to $6/gallon or even higher," JPMorgan analysts wrote.
If those assumptions hold, total U.S. gasoline inventories could fall below 160 million barrels by the end of August, which would be the lowest level since the 1950s and would translate to a national average price of $6.20 per gallon of gas.
To avoid that disaster, U.S. refineries need to "immediately" reduce exports and increase gasoline production. If they don't, "US consumers should not expect much in the way of relief in prices at the pump until the end of the year," JPMorgan said.
There are other factors that could keep the price of gasoline from hitting $6, but none of them are good. If the price rises too high too quickly, some consumers will be unwilling to drive as much and that reduced demand could help stabilize prices. Another bad option is economic recession: Reduced job growth would mean fewer people driving to work, which would ease demand for gasoline. Prices could fall, but would that matter if people were losing their jobs?
Government estimates paint a slightly more cheerful picture. The U.S. Energy Information Administration forecast in April that the national average retail price will drop to $3.75 per gallon in July and then $3.68 per gallon in September, citing an expected increase in gasoline production from U.S. refineries to "gradually place downward pressure on wholesale gasoline margins and retail prices during the summer."
American households are spending $5,000 a year on gas as prices rise and economic woes worsen
U.S. households are expected to spend an average of $5,000 on gasoline this year.
Yardeni Research concluded that Americans are paying considerably more at the pump this year, CNBC reported. By Yardeni Research’s estimates, Americans were spending a mere $2,800 last year.
The rapid pace at which gas prices continue to increase drastically affects the estimated annual sum Americans are expected to pay. This past March, Americans were expected to pay an estimated $3,800 at the pump in 2022.
The American Automobile Association (AAA) reported that in March the national average for a gallon of regular gasoline was $4.22. CNBC noted that the average price for a gallon of gasoline during the week of May 16 was $4.59. A year ago, at this time, a gallon of gasoline was $3.04.
“No wonder the Consumer Sentiment Index is so depressed. The wonder is that retail sales have been so surprisingly strong during April and May,” Yardeni said in a note.
Yardeni stated that the inflation-adjusted incomes of most consumers are barely growing and that they have accumulated a decent amount of savings while charging a lot more on their credit cards.
However, Yardeni indicated that the American consumers’ spending habits are somewhat counterintuitive, which might give the economy an illusion of strength.
Yardeni stated, “When we are happy, we spend money. When we are depressed, we spend even more money!”
For instance, despite the Consumer Price Index surging by 8.3% in April and a massive technology stock sell-off, retail sales rose by 8.2%.
Gasoline sales actually declined in April from March, as prices temporarily fell before ramping up to record levels in early May. Spending on gasoline in April increased by nearly 37% from a year ago, according to data from the Department of Commerce.
Not only are Americans paying more for necessary products, like gasoline, but their earnings in real wages are falling rapidly.
As inflation continues to spiral out of control, the average hourly earnings for employees on private nonfarm payrolls cannot keep up. These payrolls rose by only 0.3% in April, which was far lower than what was expected by economists.
This 0.3% growth was also far below April’s inflationary increase of 8.3% and March’s 8.5% increase.
According to this data, the real earnings of the American people appear to be falling by multiple percentage points.
Economic experts expect similar economic woes to continue occurring throughout the world as global stock markets continue to hemorrhage money.
The Biden administration resumes oil and gas leases on federal land but in a reduced capacity and with steeper fees
This past Friday, the Biden administration announced that it would resume granting lease sales for the drilling of oil and natural gas on federal lands.
However, as the Washington Examiner reported, the Biden administration intends to drastically decrease the amount of federal land available for drilling and plans to increase the royalty it charges companies to produce oil on federal lands.
In a recently released press release, the Department of the Interior said that it will make 144,000 acres of federal lands available for drilling. This is an 80% reduction in acreage that was originally designated for natural gas production. The department will also begin charging companies drilling royalties of 18.75% instead of 12.5%.
The release said, “The [Bureau of Land Management] will issue final environmental assessments and sale notices of upcoming oil and gas leases that reflect this strategic approach.”
“The lease sales will incorporate many of the recommendations in the Department’s report,” the release continued. “Including ensuring Tribal consultation and broad community input, reliance of the best available science including analysis of GHG emissions, and a first-ever increase in the royalty rate for new competitive leases to 18.75 percent, to ensure fair return for the American taxpayers and on par with rates charged by states and private landowners.”
It continued, “The BLM assessed potentially available and eligible acreage in Alabama, Colorado, Montana, Nevada, New Mexico, North Dakota, Oklahoma, Utah, and Wyoming. It began analyzing 646 parcels on roughly 733,000 acres that had been previously nominated for leasing by energy companies. As a result of robust environmental review, engagement with Tribes and communities, and prioritizing the American people’s broad interests in public lands, the final sale notices will offer approximately 173 parcels on roughly 144,000 acres, an 80 percent reduction from the acreage originally nominated.”
This move by the Department of the Interior comes as the Biden administration begins to acknowledge the importance of increasing domestic energy production amid soaring energy prices.
Secretary of the Interior, Deb Haaland, called the department’s new plan an overdue “reset’ of the leasing program.
She said, “For too long, the federal oil and gas leasing programs have prioritized the wants of extractive industries above local communities, the natural environment, the impact on our air and water, the needs of Tribal Nations, and, moreover, other uses of our shared public lands.”'
In response to the Russian invasion of Ukraine, Western nations issued thoroughgoing sanctions on the Russian economy. The U.S. was quick to stop importing Russian oil, and since the Biden administration ended American energy independence, American energy prices drastically rose as there was suddenly less oil being imported.
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