REHOBOTH BEACH, Del. – President Joe Biden said on Monday that he would decide by the end of the week whether to order a vacation from the federal gas tax, which is likely to save US consumers up to 18.4 cents per gallon.
“Yes, I’m thinking about it,” Biden told reporters after walking along the beach near his vacation home in Delaware. “I hope to make a decision based on the data – I’m looking for it by the end of the week.”
The administration is increasingly looking for ways to save society from higher pump prices, which began to rise last year and rose after Russia invaded Ukraine in February. Gas prices across the country average just under $ 5 a gallon, according to the AAA.
Biden said his team members should meet this week with the CEOs of major oil companies to discuss rising prices. Biden has lashed out at oil companies, saying they make excessive profits when people feel the crisis of rising pump costs and inflation. But Biden said he would not meet with oil officials in person.
“I want an explanation for why they don’t refine more oil,” Biden said.
The Biden administration has already released oil from the US Strategic Reserve and increased ethanol blending for the summer, in addition to sending a letter last week to oil refineries urging them to increase their refining capacity. However, these efforts have yet to significantly reduce price pressures, so the administration is now considering a gas tax holiday. Taxes on petrol and diesel help pay for motorways.
Penn Wharton’s budget model released estimates Wednesday showing that consumers were saving on the pump because of gas tax holidays in Connecticut, Georgia and Maryland. Most of the savings go to consumers instead of gas stations and others in the energy sector.
In an interview with ABC’s This Week on Sunday, Finance Minister Janet Yellen expressed readiness for a federal gas tax to give drivers some relief. In his own Sunday interview, Energy Secretary Jennifer Granholm told CNN “The state of the union” warned that “part of the challenge with the gas tax, of course, is that it finances roads.”
Oil refiners say their ability to produce extra gas and diesel is limited, which means prices may remain high unless demand begins to decline.
The U.S. Petroleum Institute and American Fuel & Petrochemical Manufacturers sent a joint letter to Biden on Wednesday saying the refineries were already operating near their maximum capacity and nearly half of the extracted capacity was due to the conversion of facilities to renewable fuels.
“Today’s situation does not materialize overnight and will not be resolved quickly,” the letter said. “To protect and promote US energy security and refining capacity, we urge you to take steps to promote more domestic energy production,” including new infrastructure and a reduction in regulatory burdens.
While walking on the beach with his daughter Ashley, granddaughter Naomi and her granddaughter’s fiancé, Biden stopped often to talk to beachgoers who were spending their June 16 federal vacation on the beach.
He took some time to offer guarantees for inflation – the consumer price index rose to an almost 40-year high of 8.6% in May from a month earlier – and growing warnings from economists that the recession may be around the corner .
“We’ll handle this, boys,” Biden told a group of beachgoers.
Last week, the Federal Reserve stepped up its efforts to curb inflation by raising its key interest rate by three-quarters of a percentage point – its biggest increase in nearly three decades – and signaling upcoming higher interest rates.
Former Treasury Secretary Larry Summers told NBC’s “Meet the Press” on Sunday that he estimated that “the prevailing probability will be that we will see a recession in the US economy by the end of next year.”
Biden said he spoke with Summers, who was finance minister in the Clinton administration, on Monday morning.
“Nothing is inevitable in a recession,” Biden said.
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Bowk reported from Baltimore.
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