Gas Pump Prices Tumble, but Trump Takes No Credit (Yet)
Decreasing gasoline costs, yet Trump's drill-baby-drill pledges don't seem to be the cause.
In a bold move to spin the recent decline in gasoline prices, President Donald Trump has been quick to claim credit. Yet, experts argue that his administration's policies might actually hinder further decrease in oil prices and increase domestic oil production.
Currently, the West Texas Intermediate, a benchmark for US crude oil, stands at $66.71 — a 11% drop since Trump took office. Although gas prices haven't plummeted as swiftly, they are steadily approaching the $3-per-gallon mark. The national average for a gallon of regular gas, according to AAA, sits at $3.08, a 2% drop since Trump's inauguration, but an almost 10% increase compared to a year ago.
Despite his claims, the president and his administration have been eager to back up his assertions. White House senior counselor Peter Navarro emphasized that Trump's policies are responsible for the price drop, invoking one of Trump's campaign slogans— "Drill, baby, drill." Navarro even predicted a potential drop in oil prices as low as $50 a barrel.
However, it's worth noting that the United States was already leading the world in oil production before Trump took office.ill, even with the new administration's pro-drilling policies, the record production levels don't appear to be escalating significantly.
According to the Energy Information Administration (EIA), the average daily oil production in 2025 is anticipated to be 13.5 million barrels, a 200,000 barrel-per-day increase from 2024. The EIA's forecast for 2026, however, predicts only a marginal increase to 13.6 million barrels per day.
Independent oil analyst Andy Lipow explained that the recent price drop is due to a common imbalance between supply and demand, rather than an impending surge in domestic oil production under the Trump administration. OPEC+, a group of major oil-exporting nations, plans to increase production over the next 16 months, and there are signs of weak demand for oil, particularly in China.
However, if oil prices continue to slide, it could potentially stifle production, as American oil producers struggle to maintain profits with oil prices too low for their balance sheets, and far below Navarro's $50 price target.
Trump's pledge to slash oil industry regulations and lower the price that producers need to break even could counteract this, but not to the extent that it would significantly spur production. Additionally, Wednesday's tariffs on foreign steel imports are likely to increase costs for producers.
Meanwhile, a CNN poll released on Wednesday demonstrated that a majority of Americans disapprove of Trump's handling of the economy, and an even greater proportion believes that he is not addressing high prices adequately, despite their significance in securing his election victory.
The recent drop in gas prices has contributed to a general cooling of overall price pressures, as revealed by Wednesday's Consumer Price Index report, the government's primary gauge of inflation. However, concerns loom that Trump's tariff policies could result in additional price hikes in the near future.
Lipow clarified that while recession fears may not be driving oil prices down yet, they could potentially do so in the future, particularly if there are signs of a weakening American economy or if a US or global recession begins. In such situations, gasoline prices could plummet sharply below the $3-per-gallon mark.
- The national average for a gallon of regular gas currently hovers around $3.08, a figure that coincidentally aligns with the anticipated price mark in the West by 2025, according to the Energy Information Administration (EIA).
- Meanwhile, in the background of stabilizing gasoline prices, the West Texas Intermediate remains a concern for some, with its current price at $66.71, showing signs of plateauing instead of a significant increase as White House senior counselor Peter Navarro predicted.
- Despite the recent decline in gasoline prices, the average daily oil production in 2025 is expected to only slightly escalate, highlighting the discrepancy between President Trump's administration's pro-drilling policies and their apparent impact on increasing domestic oil production.
