API, EMA Express Concerns Over High Gas Prices
API’s senior vice president said that the industry makes long-term capital investments based on supply and demand; the decline in demand was so significant and quick during COVID and then came back relatively quickly, so it's taking time for supplies to catch up.
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Executives with the American Petroleum Institute (API) and Energy Marketers of America (EMA) had lots of concerns but few solutions for the high gasoline and diesel prices being seen at pumps throughout the U.S. During the Q&A session, when asked, “What can you offer the American public about when prices may come down?” both Frank Macchiarola, API’s senior vice president of policy, economics and regulatory affairs, and Rob Underwood, president of EMA, didn't have many answers.
Macchiarola began the session by explaining what has led up to current situation, as “supplies dropped during the pandemic and had a taken a longer period of time to return,” noting that the situation had been exacerbated by Russia’s invasion of Ukraine, supply-chain constraints, labor shortages and the Biden administration's policy “to limit additional supplies into the market.”
The Biden administration has pledged to release one million barrels per day of crude oil from the U.S. Strategic Petroleum Reserve for 180 days, beginning March 31.
Noting the current global situation, Macchiarola said, “This reordering of crude oil markets to obtain their highest level in more than seven years created a global squeeze on refined products, including diesel and gasoline. American producers and refiners are working to meet energy demand as supplies continue to lag. ... We need the administration to embrace domestic energy production, not just for the short term, but for the long term, with a forward-leading strategy for American energy leadership.”
Read more here for the full article and EMA’s input.
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