Nearly two-thirds of Americans described the economy as poor in a poll released this week. In Virginia, where Republicans won a key prize in the state's governor's mansion, the economy ranked in exit polls as the most important issue , surpassing education, taxes and Covid.
Demand for energy is rising sharply. So why is Bank of America so bullish on oil? First, it's because demand continues to recover swiftly from the pandemic, especially for gasoline as consumers drive more. Demand is getting a further boost from skyrocketing natural gas prices. High natural gas prices will force some utilities and factories to switch to a relatively cheaper alternative: oil. Home heating prices are skyrocketing, and there's nothing Biden can do about it.
If oil gets too hot, consumers could balk at high prices and decide to drive less, or switch to more fuel efficient cars or electric vehicles. But Bank of America doesn't think that change will happen anywhere near the current price levels.
Remember, everything else has gone up," Blanch said, pointing to surging inflation. US oil companies aren't rushing to help.
Not only is demand strong, supply is also lagging. The people funding oil-and-gas companies are not interested in growing production anymore. They want oil companies to drill only their best wells, and return cash to shareholders.
Most companies say they will be increasing production at a modest rate in the coming months even though prices are high. So Biden is left with relatively few options as prices rise. Write to Avi Salzman at avi. Distribution and use of this material are governed by our Subscriber Agreement and by copyright law.
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Tags: PolitiFact. Louis Jacobson. Louis Jacobson has been with PolitiFact since , currently as senior correspondent. Previously, he served as deputy editor of Roll Call and as founding editor…. What does it mean? November 11, Tom Jones. Brian Williams is out. Rachel Maddow may be soon, as could others. Why are Americans buying so many pregnancy tests? Al Tompkins. It changed the wording. The demand for diesel fuel, which mostly comes from truckers and farmers, is also relatively constant.
Like with home heating oil, trucking fleets usually negotiate a diesel contract with one supplier. As a result, diesel prices tend to be more consistent than gasoline. Factors that affect gas prices at the pumps Many drivers base their choice of gas station on price alone.
Gas prices can change quickly The fact that prices for gasoline can change quickly is generally an indication that competition is working. Prices go up or down as retailers compete, and each tries to match what the other is charging.
Gas prices can be higher in some parts of Canada There are a number of factors that can affect the final price of gas at the pumps from one region of Canada to another: All provinces and territories place different taxes on gasoline.
Higher taxes contribute to higher prices at the pumps.
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