The Sconi

The Institute for Energy Research reported inflation and demand destruction has brought down the price of gas, as gasoline consumption has drastically dropped since Americans reportedly cannot afford it.

The Biden administration has been placing blame on Russian President Vladimir Putin and Russia's war with Ukraine for American price hikes across the board, especially the price of gasoline. However, now that pump prices are declining in Wisconsin and across America, Biden wants to take credit for it. 

"While demand for gasoline has rebounded a bit, it remains below where it was two years ago as historically high prices keep more drivers off the road than COVID lockdowns did in the summer of 2020," the Institute for Energy Research said in a July 28 release.

According to the Institute for Energy Research, lower gas prices are primarily driven by demand destruction, which refers to "persistent high prices or tight supplies that eventually lead to a drop in demand." During the week of July 8, national gasoline consumption dropped by 9.7% to 8.73 million barrels per day, according to data from the Energy Information Administration.

Aside from the pandemic lockdown era in 2020, this marks the lowest seasonal demand in 21 years and the steepest decline during 2022, the Institute for Energy Research reported. People can no longer afford to pay for gas and the spike in gasoline prices made Americans go on a "buyers’ strike" this summer.

As a result of decreased consumption, the West Texas Intermediate oil price dropped below $100 per barrel, according to Institute for Energy Research. The $8.50-per-barrel premium of Brent oil to U.S. West Texas Intermediate is the widest gap since mid-2019. The reduced gasoline consumption is lowering margins for refineries, causing them to switch production to more profitable fuels in an effort to protect themselves against losses.

"Gas prices are declining at one of the fastest rates we have seen in over a decade – we’re not letting up on our work to lower costs even further," President Joe Biden said in a July 22 post on Twitter.

Biden began placing blame for the rise in American prices, particularly gas prices, on the Russian war with Ukraine since early March. Fox News reports his administration coined the phrase #PutinPriceHike on Twitter and frequently maintained that rising prices have "nothing to do" with his administration’s policies, telling the American people, "make no mistake, inflation is largely the fault of Putin."

According to the American Automobile Association, the current national gas average is $4.03 per gallon. When Biden entered office, the average was $2.33 per gallon. In Wisconsin, the state average is $3.70 per gallon, while a month ago it was $4.49 per gallon.