The higher gasoline and diesel prices pushed U.S. inflation higher in August, prompting the White House to reach out to the oil and gas industry to ensure stable supply.
Consumer prices in the United States rose by the most in 14 months, Reuters, although the annual increase was a modest one. The big driver behind the price surge was gasoline. The price of the most popular passenger car fuel rose by a significant 10.6% last month, fueling a consumer price index increase of 0.6%, after two consecutive months of gains of 0.2%.
The price rise has been uneven across states, hitting some harder than others. Georgia was one of the hardest hit, and its Governor earlier this week declared a state of emergency and suspended taxes on gasoline and diesel for a period of one month in order to cushion the blow of higher prices at the pump.
The federal government, meanwhile, has contacted the oil and gas industry to ensure security of supply.
“The Energy Department is in touch with producers and refiners to resolve any issues and to try to ensure stable supply,” the head of the White House Council of Economic Advisers, Jared Bernstein. That’s not the first recent contact between the federal government and the oil industry, however. Reuters cited an unnamed source from the refining industry as saying the White House had reached out to the industry last week after Russia and Saudi Arabia announced their latest production cuts.
The White House wants to make sure everyone is focused here on potentialities for systemic disruptions that could create a supply problem.
U.S. crude oil production is climbing but is doing so more slowly than before as producers remain focused on discipline rather than growth.
