Energy Secretary Jennifer Granholm said on this week’s “Fox News Sunday” broadcast that if China opens up significantly after their extreme COVID lockdowns, there will likely be a spike in gas prices.
Partial transcript as follows:
TRACE GALLAGHER: You have said in recent weeks that you hope gas prices will continue to fall, but now, NBC is reporting this morning — and I’m quoting here — behind the scenes, officials worry prices could rise again as they keep looking for ways to get more oil on the market. Given the issues with refinery capacity and the war in Ukraine, can you give us, Secretary, any more certainly that prices will keep falling?
GRANHOLM: Yeah. As you know, gasoline comes from oil. Oil is traded on a global market. And so, we are at the whim, if you will, of what happens globally. However, this president has moved in dramatic ways to increase supply by releasing a million barrels a day from our Strategic Petroleum Reserve, as well as calling on our domestic producers, as well as international producers. We will be at record amounts of production next year. All of that is to say our Energy Information Administration has projected that by the fourth quarter, gas prices will be around $3.87 on average. Today, they’re about 3.90 — excuse me, $3.78. Today, they’re at $3.90. They have fallen every day of this summer. We’re hopeful that will continue.
But if China opens up significantly after COVID, there will be a more pressure on demand. More pressure on demand means upward pressure on prices. So we’re watching what happens globally. But we are doing everything possible to try to stabilize supply and demand to try to keep those prices coming down.
GALLAGHER: Yeah. We see — at the bottom of the screen, it says prices falling below $4. And I think it’s worth noting that in a lot of places around this country, like in California, gas is right near $6 a gallon. So, different places, different situations. I want to keep going on. This article goes on quoting here to say: There is no indication that Biden’s other efforts like publicly shaming oil and gas companies over their record profits, calling an emergency meeting with CEOs and threatening to pull unused drilling permits have had any effect on price or production, according to industry experts. So national gas prices, as we said, below $4 nationally on average for the first time since March. But the Treasury Department said last month, the releases from the Strategic Oil Reserves only lower gas by anywhere from $0.17 to $0.42 a gallon. What do you make of that?
GRANHOLM: Well, first of all, the prices have dropped, as you said, more than $1. They are now at $3.90. They were over $5. So, clearly, there has been an impact on increased production. President has done two things. The release of a million barrels a day is the biggest tool at our disposal. This is all about supply and demand. When Russia invaded Ukraine, that pulled millions of barrels off of the global market. Since oil is traded globally, we have to make up for that lost amount of fuel. And that’s why the president has called for this increase in releasing and increase in production. And as I say, we’ll be at record production, 12.7 million barrels per day, by next year.
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