We Have ‘to Hope for a Bigger Downturn Somewhere’ to Lower Gas Prices — SPR Is Drained

On Wednesday’s broadcast of Bloomberg’s “Surveillance,” co-hosts Jonathan Ferro and Lisa Abramowicz stated that the White House lacks a clear technique for coping with fuel costs within the wake of Saudi Arabia and Russia extending oil manufacturing cuts and that we’re heading in the direction of a place the place the Strategic Petroleum Reserve (SPR) “has been drawn down significantly and it’s unclear what levers you can pull, other than to hope for a bigger downturn somewhere.”

The section started with a clip of White House National Security Adviser Jake Sullivan responding to the cuts by saying that “the most important thing that the President is focused on is just trying to do everything within his toolkit to be able to get lower prices for consumers at the gas pump in the United States. It’s really the price of a gallon of gas for the American consumer, not the question of which country’s doing what, here or there, that is going to be his ultimate metric for whether we’re succeeding or not.”

Ferro responded, “I have no idea what all of that meant. Isn’t the [price of gas] higher in this country right now?”

Abramowicz responded, “Right now it is. And they lowered it for a bit, and now it’s going back up.”

Ferro then acknowledged, “So, apparently, I shouldn’t care what the Saudis and the Russians are doing. I should care about what’s happening with gas prices, but gas prices are up. So, shouldn’t I care about it?”

Abramowicz then stated that the value of fuel is “near the highest levels going back to later last year. It was higher. But, still, this is unfortunate, heading into a season that typically is not a driving season. We’re going to get toward one. It could potentially shoot higher. Basically, they’re trying to massage a message that is very uncomfortable for them right now.”

Ferro added that Sullivan “did not sound like an individual that prepared anything.”

Abramowicz then stated, “Have you seen any kind of cohesive remarks around the Strategic Petroleum Reserves and what they plan to do, what levels are important to step in with? This has been a very tricky political issue for a long time, and now, we’re setting up for an election season where that SPR has been drawn down significantly and it’s unclear what levers you can pull, other than to hope for a bigger downturn somewhere.”

Ferro then quipped, “Remember that fist bump? That has worked out nicely.”

Follow Ian Hanchett on Twitter @IanHanchett

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