On August 25, the U.S. Energy Information Administration (EIA) announced that on “the Monday before Labor Day weekend, the retail price of regular gasoline averaged $3.15 per gallon (gal) across the United States, 5% (or 17 cents/gal) lower than at the same time last year.”
What’s more, the EIA “forecast gasoline prices will decline 11%, or about 35 cents/gal, from August to December.”
In case you’re wondering, it is not luck or happenstance that has caused gas prices to fall.
As the EIA notes, “The forecast decline is driven by our expectation that crude oil prices will fall, caused by continued oil supply growth.”
In other words, the Trump administration’s common-sense approach to energy policy is paying dividends, again.
In his first term, President Trump’s "drill, baby, drill" posture led to a boom in U.S. energy production. Did you know that in 2018 the United States, under Trump, became a net oil exporter for the first time in 75 years?
Better yet, do you remember how low gas prices got while Trump 1.0 was in the Oval Office? In case you’ve forgotten, they hovered around $2 per gallon from 2017 to 2021.
Then, something strange happened. No, not the pandemic.
President Biden entered the Oval Office in January 2021. From that month forward, the price of gasoline began a steady rise. By mid-2022, the average price per gallon eclipsed $5.
That is stunning when you stop and think about it.
High gas prices are like regressive taxes. They disproportionately harm low-income families, who spend an outsized amount of their disposable income on gasoline compared to those who could not care less about the price.
In 2023, Americans spent roughly 3.2 percent of their budget on gasoline, which amounted to $2,449 in total and $204 per month.
On the other hand, in 2020, before the Biden administration declared war on fossil fuels, “gas took up 2.4% of Americans' overall spending. In that year, Americans spent $121 a month on gas and $1,447 over the course of the year.”
Biden and his elitist friends in high places looked down upon affordable gasoline, which equates to more freedom of movement for Americans. They would rather you drive an electric vehicle, by force, if need be.
They want to increase control by making travel by automobile less affordable. In their eyes, the masses should be served by public transportation anyways. Who needs private ownership of a car?
Actually, car culture is deeply embedded within the fabric of America. After World War II, when suburbs began springing up outside major metropolitan centers, the affordable American automobile transformed travel and leisure.
Owning a car is more than a form of transportation. It is a way of life.
An interesting tidbit in the EIA report is the fact that gas prices have declined in every region over the past year, except the West Coast.
According to the EIA, “Retail gasoline prices are usually the highest on the West Coast because of: Higher-than-average state taxes in several West Coast states” and “Gasoline specifications for California that make gasoline more costly to produce.”
In my home state of Illinois, gasoline taxes have increased significantly in recent years. In 2017, the tax on a gallon of gas was 19 cents. Today, I fork over 48 cents per gallon for the privilege of purchasing gasoline in the Prairie State.
As the Tax Foundation notes, “States levy taxes on fuel in a few different ways, including sales taxes, excise taxes per gallon purchased at the pump, and taxes on wholesalers or retailers, which generally get passed on to consumers via increased prices. These taxes, combined with a myriad of fees (e.g., underground storage tank fees), add to the price consumers pay at the pump.”
Based on an all-encompassing analysis, the Tax Foundation found that “California pumps up its gas tax the most at 68.1 cents per gallon (cpg), followed by Illinois (66.5 cpg) and Pennsylvania (58.7 cpg). The lowest gas tax rates are levied in Alaska at 8.95 cpg, followed by Mississippi (18.4 cpg) and Hawaii (18.5 cpg).”
Lower gas taxes, which would decrease the price consumers pay per gallon, should be the norm, not the exception. States should not punish drivers with exorbitant fees and taxes on a basic necessity like gasoline. The fact that excise taxes even exist on gasoline is absurd.
However, fret not. At least the price at the pump is falling and will likely continue to plummet in the months ahead. Happy Labor Day!
Chris Talgo (ctalgo@heartland.org) is editorial director at The Heartland Institute.
Editor's Note: President Trump is leading America into the "Golden Age" as Democrats try desperately to stop it.
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