There’s a theory that comes up repeatedly, the crux of which is that gas prices tend to fall in the lead up to major elections, like the 2022 midterms — to the advantage of incumbents. The implication is that the politicians in power can control gas prices before voters head to the polls.
But is there any merit to this theory?
First of all, there’s no doubt that high gas prices can be an electoral problem for presidents and their parties. It’s why Republican groups emphasized the pain at the pump in ads after gas prices soared to a record high above $5 in June.
Conversely, low or falling gas prices can be a great talking point for parties in power. So it shouldn’t come as a surprise either that Democrats touted the significant declines in gas prices that followed.
Heading into the midterm elections, the average gallon of gas cost $3.80, which is about $1.25 cheaper than the peak in early summer. But gas is much more expensive now than it was on election day two years ago, when the pandemic kept most people at home and the average gallon was $2.12.
In a speech on Oct. 31, President Joe Biden blamed oil companies for gas prices being so high this year. He suggested that Congress should consider taxing the “excess profits” of oil companies if they don’t lower prices, and said it’s time for them to “stop war profiteering.”
Denton Cinquegrana, chief oil analyst at the Oil Price Information Service (OPIS), says presidents don’t actually have much power to influence gas prices. But he totally understands why politicians try to take credit for low prices and try to assign blame to their opponents when costs are sky high.
“If I’m the president or if I ruled the world and gas prices were going down heading into the election, I would 100% take credit for it — despite not having anything to do with it,” he says.
Cinquegrana says it’s true that gas prices typically go down before November elections. But there’s a major catch: Gas prices also typically go down in the fall when there isn’t an election.
Why do gas prices drop in the fall?
There are two major reasons for this seasonal dip in U.S. gas prices: 1) Demand for gas usually declines after Labor Day following the summer driving season; and 2) Every autumn, there’s a switch from summer-grade to winter-grade gasoline, and the winter-grade fuel tends to be a bit cheaper.
These two factors best explain the price drops before elections, Cinquegrana said. Since we hold our national elections in even years, the fact that autumn price drops are also common in odd years is a good indication that the trend isn’t a result of politicians pulling strings to lower gas prices before national elections.
Citigroup Energy Strategist Eric Lee said U.S. gas prices move up and down with global market trends. For the most part, it’s Mother Nature, geopolitics and the global supply and demand for oil that drive consumer gas prices, not the policies of American presidents and politicians, he said.
Gasoline is made from crude oil and other petroleum liquids. Crude oil prices are responsible for 54% of what a gallon of gas costs drivers at the pump.
Weather events can disrupt oil and gasoline infrastructure, lifting prices higher, and the conditions of the season impact our driving habits and the demand for fuel.
Lee said the theory that gas prices fall before elections isn’t backed up by empirical data. Looking at the gas price changes in the months before midterm and presidential elections, he said he isn’t able to spot a clear pattern of movement in either direction, beyond the seasonal trends we see every year.
“It’s pretty all over the place when I look at like three months before November and six months before November since 1993,” Lee said. “There were some big drops around 2007 and 2008, but really that was about the great financial crisis.”
Lee said it’s safe to conclude that the theory is a myth. Even so, he acknowledges that this year is a bit unusual because the high gas prices that followed Russia’s invasion of Ukraine prompted an unprecedented response from the White House.
What's more, there's an obvious flaw in the theory that's apparent this season. Gas prices haven't really fallen steadily or deeply this autumn: The national average for regular gas was below $3.70 in mid-September, and it's roughly 10 cents higher now.
Does the president control gas prices?
Lee explained that while it makes sense American politicians would want to try to lower gas prices before elections, "there are very limited levers” to actually do so.
The Biden Administration’s decision to release oil from U.S. strategic reserves, in coordination with dozens of other countries that released from their reserves, undoubtedly led to lower gas prices than what we would have otherwise seen, he said.
“This was a coordinated strategic petroleum reserve release, which was pretty unprecedented in terms of the number of countries involved,” Lee said. “That was effective.”
Cinquegrana agreed that the recent release of oil from reserves is a rare case of an administration’s action having an immediate, direct impact on gas prices.
“I would say that the releases from the strategic reserves, I don't think they necessarily dropped gas prices, what I do think they did was they kept prices from going even higher than they did,” he said.
But Lee said it’s important to remember that this isn’t something we’ve seen happen in advance of previous elections, nor should we expect oil to be released from reserves in the months before future elections, barring another major emergency situation.
On Nov. 3, the federal government said it sold 15 million barrels of oil from strategic reserves, completing Biden’s plan to release 180 million barrels.
Beyond releasing oil from reserves, Lee said there’s not much American presidents can do to lower gas prices. The Biden administration tried just about everything since February, he said, short of some of the more radical ideas like banning oil and gasoline exports, and the benefits have only been marginal.
Biden has also faced criticism that he contributed to high gas prices by blocking construction of the Keystone XL pipeline, which would have carried oil from Alberta, Canada, to Steele City, Nebraska.
However, officials were not planning for the pipeline to be in service until 2023, so the cancellation of the project isn't factoring into our current prices yet. Experts say the pipeline's impact on gas prices would have been minimal.
Even the release of oil from strategic reserves, which Lee and Cinquegrana said was the most effective move, probably only accounts for a small fraction of the drop in gas prices since June.
The White House asked OPEC+ to increase its oil output, but that effort was mostly unsuccessful, Lee said. The administration has tried to ramp up domestic output, though it’s not a quick fix — measures aimed at increasing output typically won’t produce benefits for at least 6 to 9 months, he said.