Seemingly determined to repeat every energy policy error of the last half century, Joe Biden’s war on the domestic oil and gas industry gained new steam last week even as gasoline and diesel prices rose to new record highs.
AAA reported Sunday that the average national price for a gallon of regular gas rose to a new record of $4.85, recording a 24-cent increase for the week ended June 4. The average price for diesel fuel, a major driver of inflation for consumer goods, also hit a new record high on the same day of $5.64.
Despite the reality that a shortage of refining capacity is a cause of high diesel prices, Biden’s EPA carried the administration’s assault on the industry to its downstream sector late in the week. On Friday, EPA announced additional biofuel blending mandates not just for 2022, but also retroactive mandates that will force refiners to make up for 2020 and 2021 volumes that were previously suspended due to the COVID-19 pandemic.
The EPA edict will not just raise the cost of refining and distribution of gas and diesel – and thus result in even higher prices at the pump – it will also take millions more tons of corn out of the food supply during a time of growing global food shortages. As such, it is a policy action that prioritizes the making of biofuel that many believe serves no useful environmental or economic purpose over efforts to prevent starvation in developing nations.
At the same time the administration is increasing troubles for refiners, the White House is considering having the President issue an executive order to release diesel from the federal Northeast Home Heating Oil Reserve (NHHOR). Such a release would provide only limited relief to East Coast diesel shortages, since the reserve contains just 1 million barrels of fuel. It would also be highly questionable from a strategic standpoint, since the NHHOR, like the Strategic Petroleum Reserve, was intended as a reserve of fuel for times of national or regional emergencies.