The unexpected drop in gasoline prices has given Trump a political boost, even as energy analysts warn the fragile ceasefire and tightening oil supplies could quickly reverse the trend.
Gasoline prices have fallen precipitously since the U.S. and Iran began their fragile truce, defying expert predictions of a long summer slog with sky-high prices.
Instead of spiraling upward, the average price at the pump has plummeted 70 cents per gallon in a month from a peak of $4.56. A little over a week since the memorandum of understanding was signed between the countries, a barrel of oil costs just a little more than it did before the U.S. and Israel bombed Iran in late February.
It wasn’t supposed to work this way, according to energy experts whose predictions of $150 barrel of oil, $5 gasoline and summer recessions were widely quoted in the media, including POLITICO.
For now, they’ve been proven wrong for a litany of reasons, including a surprisingly weak Chinese economy and a failure to imagine how handily the president could bully the markets into submission.
“There’s one thing that being an oil market analyst, much less a price forecaster, will teach you and that is humility,” said Bob McNally, a former energy adviser to the George W. Bush administration, now head of energy consulting firm Rapidan Energy. He predicted that price spikes could still happen in the weeks ahead as the ceasefire remains fragile.
The falling prices are a huge win for the president and his party, helping to blunt an easy Democratic attack line ahead of the upcoming midterms in which voters say they are hyperfocused on the cost-of-living. While voters may never forgive the spike, many political prognosticators thought it was going to be much worse.
If the current prices hold, the midterms may not be quite as catastrophic for Trump and Republicans in November, said Frank Luntz, the veteran Republican pollster. But he said the deadline for easing voter anxiety over affordability is essentially now. That’s because voter attitudes are locked in by August, which means that further price drops in September and October are likely less meaningful.
“Half of Americans live paycheck to paycheck so a momentary drop in prices will not have a major impact on the electorate, it has to be something sustainable,” he said.
POLITICO
