REHOBOTH BEACH, Del. (AP) — Gas prices nationwide are averaging just under $5 a gallon, according to AAA. Pres. Joe Biden said Monday that he’s considering a federal holiday on the gasoline tax, possibly saving U.S. consumers as much as 18.4 cents a gallon.
“Yes, I’m considering it,” Biden told reporters after taking a walk along the beach near his vacation home in Delaware. “I hope to have a decision based on the data—I’m looking for by the end of the week.”
Taxes on gasoline and diesel fuel help to pay for highways. But the Penn Wharton Budget Model released estimates Wednesday showing that consumers saved at the pump because of gas tax holidays in Connecticut, Georgia, and Maryland. The majority of the savings went to consumers, instead of service stations and others in the energy sector.
Strolling on the beach with his daughter Ashley, granddaughter Naomi, and his granddaughter’s fiancé, Biden stopped frequently to chat with beachgoers who were spending the Juneteenth federal holiday at the beach. He took a moment to offer assurances about inflation—the consumer-price index increased to a nearly 40-year high of 8.6% in May from the same month a year ago—and growing warnings from economists that a recession may be around the corner.
“We’re going to get through this, guys,” Biden told one group of beachgoers.
The administration is increasingly looking for ways to spare the public from higher prices at the pump, which began to climb last year and surged after Russia invaded Ukraine in February. Biden said members of his team were to meet this week with CEOs of the major oil companies to discuss rising oil prices, but that he would not be meeting the oil executives himself.
Biden lashed out at oil companies, saying they are making excessive profits when people are feeling the crunch of skyrocketing costs at the pump and inflation. “I want an explanation for why they aren’t refining more oil,” Biden said.
The Biden administration has already released oil from the U.S. strategic reserve and increased ethanol blending for the summer, in addition to sending a letter last week to oil refiners urging them to increase their refining capacity. Yet those efforts have yet to reduce price pressures meaningfully, such that the administration is now considering a gas tax holiday.
Last week, the Federal Reserve stepped up its drive to tame inflation by raising its key interest rate by three-quarters of a point—its largest increase in nearly three decades—and signaled more large rate increases to come.
In an interview Sunday on ABC’s “This Week,” Treasury Secretary Janet Yellen expressed an openness to a federal gas tax holiday to give motorists some relief.
Former Treasury Secretary Larry Summers told NBC’s “Meet the Press” on Sunday that in his estimation, “the dominant probability would be that by the end of next year, we would be seeing a recession in the American economy.”
Biden said he spoke with Summers, who served as treasury secretary in the Clinton administration, on Monday morning. “There’s nothing inevitable about a recession,” Biden said.