(UnitedVoice.com) – Throughout 2021, US gasoline prices have grown to significant highs over what they were the last few years. Along with it, inflation rose on virtually everything you buy. For months, the Biden administration said inflation was likely a temporary thing. Over the last month, many economists reaccessed and changed their tunes. Now, there’s more bad news on the way, and Biden’s energy policies almost entirely drive it.
From 2017 to 2020, America became energy independent for the first time in decades. It was primarily due to President Donald Trump’s policies that cut regulations on the energy industry and spurred growth in natural gas and oil extraction across the country. Not only was the supply plentiful enough to meet America’s needs, but the country also exported it as well.
Additionally, the excess of natural gas also lowered the US dependence on greenhouse emissions. The energy sector replaced coal plants with natural gas, and Americans experienced lower gasoline and natural gas prices. Now that Biden is reversing course as promised, there is a serious supply crunch, and economists expect prices to increase from September through the winter months.
Natural Gas Prices Set to Explode
Natural gas is the top resource for energy in the United States. Not only is it used to heat 50% of America’s homes, but power plants also use natural gas to create electricity. Electric providers use 38% of the gross US natural gas supply to provide electricity to the grid.
Summer is the time of year that the US energy industry stockpiles natural gas in anticipation of colder months when demand is at its peak. Without the stockpile, there could be a natural gas shortage.
To combat Biden’s fracking rule changes, energy producers moved offshore into the Gulf of Mexico. However, Hurricane Ida put natural gas extraction behind the curve, and additional hurricanes could still develop before the season ends, exacerbating the problem further. Extraction on land isn’t vulnerable to the weather the way it is at sea. Unfortunately, the Biden administration wasn’t forward-thinking to account for the variable.
Natural gas supplies are nearly 17% below 2020 levels and 7.2% below the five-year average. If gulf extractions don’t rebound soon, it’s likely to cause more price increases and possible shortages for home and business heating needs, as well as electricity generation.
What does this mean for your heating needs this winter? Natural gas prices are already 99% higher year-to-date. If supply concerns continue as demand rises, so will the price you pay to keep warm. Some predictions suggest if the winter is cold, the price could double from today’s highs.
Not only will you pay for it in your electric bill, but it could push inflation higher as you pay more at the store for the things you need. So much for any increase in wages. If prices continue higher, it will negate any increase in personal income. It could even mean less money in your pocket.
Will Biden reverse course?
Don’t bank on it. Instead of increasing production in the United States, he’ll likely return to OPEC and ask them to increase output.
Doesn’t that sound like a winning strategy for America?
Don Purdum, Independent Political Analyst
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