#USDecides2024: Trump says if elected president he’ll get gas prices under $2 a gallon. Is that possible?

Donald Trump vows the price of gasoline will drop under $2 a gallon if he’s president.

But there’s no way he can simply make that happen, say the experts.

“There’s a zero percent chance a president can fulfill that promise,” said Patrick De Haan, head of petroleum analysis at GasBuddy, which tracks prices.

 

As he campaigns for president, Trump has often pledged to bring down gasoline prices below their levels during his presidency from 2017 to 2021.

“Energy is going to bring us back. That means we’re going down and getting gasoline below $2 a gallon, bring down the price of everything from electricity rates to groceries, airfares, and housing costs,” he told the Economic Club of New York earlier this month.

Trump and Republicans boast that during his presidency, the price of gasoline nationally never averaged more than $3 a gallon each month. That’s true.

Nationally, the average price of a gallon of gas averaged $2.35 in January 2017, according to the federal Energy Information Administration.

Gas prices and the White House

Whether Trump had much to do with that is a matter of debate. Prices had been falling in the last years of the Obama administration, as OPEC nations flooded the market and drove prices down.

Prices remained fairly stable under Trump, and when President Joe Biden took office four years later, the average was $2.33.

Under Trump, the price did go as high as $2.89 in May 2018 and as low as $1.84 in April, 2020, as the Covid pandemic paralyzed the economy.

In California, gasoline prices averaged $2.85 a gallon when Trump took office and $3.26 when he left. California prices tend to be higher than the national average because of higher state and local taxes, refinery maintenance issues and environmental standards.

Under Biden, prices soared, reaching a national average of $4.93 and a California average of $6.29 in June, 2022. A surge in post-pandemic demand and supply tightening as Russia invaded Ukraine helped send prices higher.

Since then, prices have dropped, going back under $3 a gallon in many places. The average price of gasoline nationally last month was $3.39. The California average was $4.51.

Trump’s gas price plan

Trump and his allies contend they can bring those numbers down further as they ease regulations governing energy and promote more domestic oil drilling.

“We will blast through every bureaucratic hurdle to issue rapid approvals for new drilling, new pipelines, new refineries, new power plants, new electric plants, and reactors of all types,” Trump said in his New York speech.

“Prices will fall immediately in anticipation of this tremendous supply that we can create rather quickly, and we’ll be the leader instead of the laggard,” he said.

It’s not that easy, said the experts.

“The supply of oil would have to be increased significantly and demand decreased for the price of gas to fall below $2 – an unrealistic number,” said Sanjay Varshney, professor of finance at California State University, Sacramento.

“Given global drivers in the oil market and localized refinery and distribution expenses, it is unlikely that the president or any one individual can impact gas prices that much to bring them down to under $2,” he said. “The president cannot create production. The more companies flood the market with supply, the more the price is likely to drop, jeopardizing profits.”

Unpredictables

Even if Trump could ease enough regulations to make more drilling profitable, he’d still have to contend with international suppliers and the often unpredictable effort to balance supply and demand.

“Oil prices are set in a global market and are determined by supply and demand. There are very few options that a president – or any world leader – has to significantly increase supply. And, even if that were possible, it could be met by a supply reduction in another area that would negate the increase,” said Jeff Lenard, vice president, strategic energy initiatives at the National Association of Convenience Stores.

Another, important factor no president can control: State and local taxes.

California has the highest average state and local taxes and fees on gasoline in the country, 69.8 cents a gallon as of July 1, according to EIA. Overall, EIA estimated that in July, taxes nationally accounted for 15% of the price of a gallon of gasoline. Marketing costs comprised another 16%, and refining 13%. The price of crude oil was 56% of the price.

With so many factors involved in the price, it’s impossible to think prices can be affected in a big way at the White House.

“A president really can’t effectively pull that off,” said De Haan.