Photo by dynamosquito. Some rights reserved.
New York Times political correspondent Michael Shear took an in-depth look yesterday at the GOP’s effort to spin rising gas prices against the Obama administration in anticipation of attacking the administration’s economic policies at large in the looming general election. Current oil prices are hovering somewhere around $105 a barrel and #3.58 per gallon at the pumps (up 40 cents from where it was a year ago at this time), with those prices expected to spike somewhere over the $4 mark before the summer arrives. White House Press Secretary Jay Carney was quick to deflect these prices away from the President, stating that “there are no magic solutions to rising oil prices” and highlighting the fact that American oil production is at the highest level that it has been in eight years.
In his piece, Shear is quick to point at the rising conflict in Iran, and international concern over its nuclear weapons arsenal. Earlier this week, Iran announced that it would cut off oil shipments to Britain and France in response to their tougher sanctions against them, and experts have also linked the U.S.’s warnings against Israel’s hostilities towards Iran as responsible for the rising oil prices.
But growing concerns over nuclear war are not the only reason for these high domestic prices (thank God). Economists have also highlighted the recent surge in the U.S. economy as perhaps equally responsible. Shear also appeared this week on PBS’s News Hour alongside John Kilduff, founding partner at the hedge fund Again Capital. Kilduff had this to say about how the improvement in the economy could negatively affect gas prices for the American consumer:
“The U.S. employment picture in particular and a lot of the coincident economic indicators, the various Federal Reserve reports that have come out over the past couple of months now have all indicated a growing U.S. economy, which speaks directly to increased gasoline demand… There’s no doubt that there’s investors of all stripes right now betting on the fact that there’s going to be a conflict with Iran, that the global economy is going to outpace available oil demand and push the price up ahead of time.”
Meanwhile, Shear goes on to speculate how the GOP will end up using these high oil prices as ammunition against Obama in the coming election:
[Republicans] think that, you know, the gas prices both affects people in the short term. And if they can, you know, blame President Obama for what people feel like when they go and pay $60 to fill up their car, that’s a winner.
He also remarks that he’s unsure how much Iran will come up specifically on the Republican side of the conversation:
“…It’s in their interests from a political perspective to talk less about kind of the underlying economic factors that are maybe outside of the president’s control, and focus more on what they claim the president could do or is not doing to fix this situation.”
Environmental blog Treehugger points out, on the other hand, that expanding American drilling efforts will do nothing to temper oil prices in the short term, because of the time it takes to approve, develop, and transport from new operations, making very little difference in the context of the larger global oil market. As so many conservationists have pointed out, this may in fact be an opportunity for Obama and Democrats to get on message about the impossibility of relying on fossil fuels in these tumultuous times.