KJP: Putin's war added $2 per gallon to the price of gas, you know

Just how incompetent has the spin become at the White House to shift blame for inflation and rapid gas price hikes away from Joe Biden? It’s as incompetent as it is desperate. Karine Jean-Pierre tried to flog the “Putin price hike” line on The View this morning, and claimed that Vladimir Putin’s war in Ukraine had “caused gas prices to go up $2 per gallon.”

That’s not just false, but it’s laughably false, and not just on price:

The Energy Information Agency (EIA) has not yet updated the data this week with the latest average per-gallon price across all formulations for gasoline. Last week, that stood at $5.107, which means that Jean-Pierre is claiming that it was at $3.107 or thereabouts in the last week of February, when the Ukraine war started. That’s not true, however; the EIA average for that week was $3.701, almost exactly $1.40 per gallon lower. That’s still a significant increase, but that price level was $1.24 per gallon at that point higher than when Joe Biden took office ($2.464).

The last time that the EIA average was at or below $3.107? Mid-May 2021. Here’s a chart of EIA gas price averages since the beginning of 2021:

Biden got around to banning already-minimal Russian oil imports two weeks after the invasion, and it produced a short-lived sharp spike in the trendline on gasoline prices. However, those prices settled back to the upward trend line that had been generally flowing since the start of Biden’s presidency and especially in early December, almost three months before the invasion of Ukraine.

Russian oil is still on the market, too. The EU didn’t even put forward a plan to embargo Russian oil and gas until three weeks ago, and it will be another several months before those take effect. Instead of slowing down Putin’s income, it appears that Putin is benefiting from the market impacts of the sanctions:

Far from celebrating, the EU today is scratching its head over the amount of money the Russians continue to scoop up as a result of high oil prices and Moscow’s ability to counteract the West’s sanctions regime. Indeed, Moscow is earning more money from oil exports than it was before the war in Ukraine began. The Center for Research on Energy and Clean Air, an organization in Finland, calculates that Russia’s export prices for fossil fuels in general are about 60 percent higher than they were last year. Asked by lawmakers whether Moscow was raking in more money from oil sales now than in the months before the war, Amos Hochstein, the Biden administration’s envoy for energy affairs, wasn’t cute with his answer: “I can’t deny that.” …

The first and most obvious is the extremely high price of crude oil. On June 21, Brent Crude opened at $114 a barrel, approximately 55 percent higher than this time last year. For major petro-states like Saudi Arabia, the United Arab Emirates, and Russia, these are the good old days, when high demand and tight global supply produces record profits. Naturally, the more profits Russia earns, the more resources Putin will have available to finance his war of aggression and ensure discontent on the Russian street doesn’t get out of hand.

Current prices are so sky-high, in fact, that Russia continues to make hefty earnings even after offering significant discounts to buyers. At spot rates of about $73 a barrel, and based on current market prices, customers are saving about 51 percent if they go with Russian Urals crude instead of Brent (how long the current supply-demand dynamics will hold is another question entirely).

This leads to the second reason why the EU’s oil sanctions aren’t having an immediate effect: Russia is reworking its entire oil distribution network. The Russians aren’t standing around; they’re creating new opportunities. Before the war, about 60 percent of Russia’s oil exports went to Europe, with the rest going to China. Now, the Russians are redirecting previously Europe-bound oil cargoes to countries in Asia, which are looking for the cheap and most reliable energy supply they can get. In May, Russian crude exports to China increased by 28 percent from the previous month, replacing Saudi Arabia as Beijing’s biggest source of the black stuff. India is receiving 760,000 Russian barrels a day, an exponential jump compared to previous levels, which were near zero.

The failure of sanctions to bite isn’t a great mystery. The US and EU had hoped to get other trading blocs to join their economic war on Russia, but China and India have other national interests than settling European conflicts. It didn’t help that the US and the EU acted so tentatively when applying sanctions to Russia’s oil industry, either. The EU still can trade with Russia for the oil that funds the war that their members are fighting by proxy in Ukraine.

The only way to punish Putin for his aggression is to dilute his selling power. The only way to do that is to flood the markets with supply. And nearly the only way to do that is for the US to greatly and sharply increase its production and by extension refining of petroleum. Biden refuses to take that step. Even to the extent that the Ukraine war is impacting gas prices at home, that’s still a reflection of Biden’s energy policy and his obstinate refusal to adjust for the current strategic environment.

To emphasize: we have a supply issue, not a war issue. That supply issue has been building since Joe Biden issued EO 13990 on Day One of his presidency, as the EIA chart documents. That’s why gas prices rose by 50.2% before Putin invaded Ukraine, and why it has continued to rise an additional 38% since then. Furthermore, the proposal Jean-Pierre flogs here will actively make the situation worse by incentivizing short-term demand without providing any additional supply, all for a benefit at best of around $39 per household over three months … which won’t even pay for a full tank of gas now.

The lies and spin of Biden and Jean-Pierre defy credulity — and the actual facts.