Gas! It’s cheap these days. And getting cheaper. The Energy Information Administration reports that this week the average price of regular gasoline fell below $2 a gallon for the first time since 2009. At $1.996, granted, it barely crossed the mark. But considering that this time two years ago gas cost more than $3 a gallon, this is a milestone.1
Adjusting for inflation, fuel is still more expensive than during the 1990s, but with oil’s continued collapse, it’s not inconceivable that we could eventually return to those rock-bottom prices. If your idea of a good time involves burning extravagant quantities of fossil fuels, it’s a great moment to be alive.
It is becoming traditional in these sorts of posts to mock Republican politicians like Newt Gingrich, who during his 2012 presidential campaign promised to bring the price of fuel alllllll the way down to $2.50 a gallon, or Utah Sen. Mike Lee, who predicted (based on some flimsy arithmetic) that President Obama’s re-election would send gas to $6.60 a gallon. I would never stoop so low.
But since we’re in the middle of a presidential election season, you may still be wondering: What’s the best possible way to turn these prices into a convenient political talking point?
If you’re a liberal: Insofar as President Obama is contributing directly to today’s prices, it’s due to his nuclear deal with Iran, which will allow Tehran to start selling crude normally on the international market, and thus help ensure the world is oversupplied with oil for a good long while. You could also note that pipeline politics aside, he hasn’t really done anything to stand in the way of U.S. shale development, which has forced Saudi Arabia into the oil price war that is now making it so cheap to fill up your Honda.
If you’re a conservative: Point out that oil (and thus gasoline) is cheap in large part because the global economy is in shabby shape and China is slowing down. This comes with the disadvantage of indirectly highlighting America’s relatively robust economy, but it may create a general sense of unease about the fact that, hey, the world could be on some sort of awful precipice. You might also point out that Republicans in Congress forced through legislation allowing the U.S. to export oil for the first time in 40 years, which is probably going to weigh down prices in international markets slightly. (But just slightly. On the list of reasons why oil and gasoline are cheap right now, that probably ranks, like, 49th).
If you’re generally irritated by politics: Point out that just a few years ago, virtually nobody foresaw the current state of affairs, which is a sign that you generally shouldn’t trust elected officials making promises about hydrocarbons. Credit where it’s due: In his 2013 book The Power Surge, Michael Levi of the Council on Foreign Relations specifically outlined the possibility that excess oil capacity would lead to a worldwide competition for market share and a price war. Kudos to Levi, who is obviously a better person to consult on these issues than Mike Lee.
1AAA said gas prices crossed the $2 mark last month, but EIA is the more important authority.