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Bobby Scott: Low gas prices are the result of Obama policies
One of the first actions by the U.S. House of Representatives this year was to pass a bill approving the Keystone XL pipeline.
House Republicans, who boosted their majority in fall elections, have long said that oil pipeline would fortify the nation’s energy supply and help keep a lid on gas prices. The nearly 1,200-mile pipeline would send up to 830,000 barrels of oil a day from the Alberta oil sands in Canada to Steele City, Neb., where it would be piped to Gulf Coast refineries.
But Rep. Bobby Scott, D-3rd, doesn’t buy that argument. He voted against the measure, which President Barack Obama vows to veto if it clears the Senate.
In a Jan. 9 news release, Scott noted gas prices are already at their lowest levels in years and added this observation:
"Instead of exempting foreign corporations from federal permitting requirements, Congress should be working on policies that diversify our nation’s energy portfolio, reduce our reliance on fossil fuels and support the president’s policies that have resulted in gas prices being reduced from $3.07 per gallon when he was sworn in in 2009 to $2.30 today," Scott said.
We looked into Scott’s claim that Obama’s policies has resulted in a 77-cent per gallon drop in gas prices since the president’s first inauguration.
We quickly learned that Scott’s figures are wrong. The price of gas increased by about 36-cents a gallon from the start of Obama’s presidency to the time Scott made his statement.
On Jan. 19, 2009, the day before Obama was inaugurated, the average national price of regular gas was $1.85 per gallon, according to the U.S. Energy Information Administration. In December 2008 and January 2009, it remained below $2 a gallon -- the low watermark over the past 10 years. The U.S. was in the teeth of the Great Recession then and analysts largely attributed the low prices to a drop in gas demand.
So the price of gas when Obama took office was $1.22 a gallon cheaper than the $3.07 average Scott cited.
David Dailey, a spokesman for Scott, told us the congressman’s office made an "honest mistake" by starting the comparison on the drop in gas prices figures on Jan. 21, 2008 -- when records show gas averaged $3.02 per gallon.
When Scott made his statement on Jan. 9, the price of gas was $2.21 per gallon. And it’s fallen further since. At this writing, the average price is $2.14 a gallon, the lowest level since May 2009. That’s a steep drop from the highwater mark of $3.94 a gallon in April 2012.
Scott’s office reissued the news release on Jan. 12, taking out the numbers but continuing to say the president’s policies "have resulted in gas prices being reduced to lows not seen in years."
To back Scott’s contention, Dailey pointed to EIA reports showing that during Obama’s administration, domestic production of crude oil has risen from 5.4 million barrels a day in the first quarter of 2009 to 9.1 million barrels daily in the last three months of 2014. Dailey also cited figures showing that net imports of liquid fuels have dropped during Obama’s term.
Dailey said the White House’s insistence on tougher standards for greenhouse gas emissions and vehicle fuel efficiency have helped lead to a drop in gas consumption. He pointed to a March 2014 report from the nonpartisan General Accounting Office which says those initiatives "have contributed to reductions in the consumption of petroleum fuels, but the extent is unclear."
But Scott’s statements go beyond saying the president’s policies have merely contributed to today’s low gas prices. The congressman said the policies "have resulted in gas prices being reduced to lows not seen in years." That gives all credit to Obama.
We spoke to two oil analysts and they both took issue with Scott’s claim.
"I would challenge any politician who is saying the recent six-month downturn in gas prices has anything to do with a politician (Obama) who has been in office for several years, who has witnessed a sustained period of high prices," said Patrick DeHaan, a senior petroleum analyst at GasBuddy.com, which tracks U.S. gas prices.
Government actions typically have little impact on the fluctuation of gas prices, he said.
DeHaan credits the increased domestic oil production to decisions by oil companies to invest profits banked just before Obama took office in tapping shale oil deposits in North Dakota and elsewhere.
The main factor in the recent price drop, DeHaan said, is a decision by OPEC countries not to cut production to drive up oil demand. OPEC believes the declining prices, left unabated, will make the production of shale oil unprofitable.
Tom Kloza, global head of energy analysis at the Oil Price Information Service, told us neither Obama nor any elected official is responsible for the oil shale boom, which he attributes to other factors such as technological advances in tapping oil deposits.
"The oil shale boom took place while President Obama was in office, but the production increases had little to do with government policy (other than low interest rates from Fed governors)," Kloza wrote in an email.
Kloza, however, does give Obama credit for supporting tough fuel economy standards that he said has contributed to lower prices.
"Almost all of what has happened (up and down) for oil within the 2009-to-present period has occurred through capitalism," wrote Kloza. "The president can neither be blamed nor praised for most of the fluctuations."
We also point out that beyond rising U.S. production and OPEC’s decision against cutting production, other factors have been cited for lowered gas prices, including economic stagnation in Europe.
Scott says Obama’s policies have resulted in a 77-cent per gallon drop in the price of gas since the president took office.
Scott’s office acknowledges its numbers were wrong. At this writing, gas has actually increased by 36-cents a gallon since Obama entered the White House. That’s because at the time of his inauguration, volatile gas prices had dipped to the lowest levels in the last 10 years.
Experts say presidents have little control over the cost of filling your car. Gas prices rise and fall in response to worldwide economic conditions, production decisions made by oil-producing nations, and the investment decisions of oil companies.
Obama didn’t cause the roller coaster rise is gas prices that began shortly after his first inauguration, nor did he cause the sharp fall that now thrills drivers. So we rate Scott’s statement False.
Rep. Bobby Scott, "Scott opposes latest attempt to force approval of Keystone XL pipeline," Jan. 9, 2015.
Email from David Dailey, spokesman for Rep. Bobby Scott, Jan. 13, 2015.
Energy Information Administration, "Weekly U.S. Regular all formulations retail gasoline prices," accessed Jan. 15, 2015.
Interview with Patrick DeHaan, senior petroleum analyst at GasBuddy.com, Jan. 14, 2015.
Email from Tom Kloza, cofounder of the Oil Price Information Service, Jan. 14, 2015.
Interviews with Jonathan Cogan, spokesman for the Energy Information Administration, Jan. 16, 2015.
The New York Times, "Oil Prices: What’s behind the drop? Simple economics," Jan. 12, 2015.
The Economist, "Why the price of oil is falling," Dec. 8, 2014.
PolitiFact Virginia, "George Allen says price of gas tank fill up has risen $30 during Obama’s term," Feb. 6, 2012.
PolitiFact Virginia, "Ed Gillespie says Mark Warner’s record is against the Keystone XL pipeline," June 23, 2014.
PolitiFact, "In State of the Union, Obama says the U.S. produces more oil than it buys," Jan. 28, 2014.
U.S. Energy Information Administration, "Short-term energy and summer fuels outlook," April 14, 2009.
U.S. Energy Information Administration, "Short-term energy outlook," January 2015.
U.S. Energy Information Administration, "U.S. field production of crude oil," accessed Jan. 16, 2015.
U.S. Energy Information Administration, "U.S. imports of crude oil," accessed Jan. 16, 2015.
U.S. Energy Information Administration, "U.S. net imports of crude oil and petroleum products," accessed Jan. 16, 2015.
Government Accounting Office, "Petroleum refining: Industry’s outlook depends on market changes and key environmental regulations," March 2014.
The Hill, "Four more votes needed to override Keystone veto," Jan. 11, 2015.
House bill to approve Keystone XL pipeline, accessed Jan. 13, 2015.
National Highway Traffic and Safety Administration, "Corporate Average Fuel Economy (CAFE)," accessed Jan. 16, 2015.
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