The price of Petroleum Texas Intermediate (WTI) opened this Wednesday with a drop of 6.30%, to 102.62 dollars a barrel, a drop that was recorded hours before the US president, Joe Bidenrequest a July-September suspension of the federal gas tax.
As of 0900 New York local time (1300 GMT), WTI futures contracts for August delivery were down $6.90 from the previous session’s close.
According to local media, Biden could ask Congress today to greenlight a three-month suspension of the 18.4-cent-per-gallon federal gas tax and ask states to suspend their fuel taxes.
Since the start of war in Ukrainealmost four months ago, energy prices rose and remained near historically high levels, as the invasion of Ukraine by Russia has caused Western nations to increasingly reduce supplies from Moscow.
“This is a reminder to the markets that governments are unlikely to sit back and accept market prices. Petroleum higher,” Edward Park, chief investment officer at UK investment firm Brooks Macdonald, told The Wall Street Journal.
However, that tax depends on Congress, which is the one that would ultimately have to approve the temporary suspension.
In the past, Republicans have opposed removing this gas tax, and even some Democrats have disagreed with the idea.
On the other hand, the White House invited the CEOs of seven oil companies to a meeting this week to discuss ways to increase production capacity and cut fuel prices by about $5 a gallon.
Chevron responded yesterday to Biden urging him to collaborate with the oil companies and not “demonize” them in the face of his growing pressure campaign to produce more fuel and lower prices.
