Government policy cannot significantly reduce gas prices in the short term, experts told ABC News.
Government policy cannot meaningfully relieve the price increases in the short term, besides an additional release of oil from the strategic reserve or a gas tax holiday, each of which would likely reduce just a fraction of the cost, experts told ABC News. But steps taken now could help foster decreases over the long term and insulate the market from future disruptions, they added.
The release of oil from the U.S. SPR is offering slight relief for the rise in the price of gasoline, some experts told ABC News. “The price of oil would be even higher without those stockpiles being used,” said Pavel Molchanov, a senior energy analyst at Raymond James.If the U.S. decided to release even more oil from its reserves, the move could marginally slow the rise in gas prices even further, the experts said.
Glickman, the energy analyst at CFRA, said the move from Biden is unlikely to increase supply and lower gas prices, since the domestic industry is already operating at as high as 96% capacity. The refineries cannot add capacity in a short period of time, Glickman added. One approach to incentivizing an increase in U.S. production includes a potential tax on oil company profits. But such a move wouldn’t remove the impediments to greater oil production capacity, Glickman said.“Whether you do something like taxing the industry or not, it isn’t going to change how much capacity you bring back,” he said.
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