Alarm on gas prices

Susie Wiles sounds the alarm on gas prices

White House aides and Cabinet officials are coming under intense pressure to reverse the spike in energy prices caused by the start of the war in the Middle East.

By Ben Lefebvre

President Donald Trump’s chief of staff, Susie Wiles, is telling his advisers to bring ideas to the Oval Office to lower gasoline prices in the wake of the U.S. attack on Iran, according to two energy industry executives familiar with the conversations.

The White House is “looking under every rock for ideas on improving energy prices, especially gasoline prices,” said one of the executives, who was granted anonymity to describe internal administration discussions.

The attack and Iran’s subsequent targeting of the Persian Gulf’s energy sector has sent crude oil up more than $10 a barrel, lifting gasoline prices to their highest levels since Trump took office last year.

Energy Secretary Chris Wright and other advisers focused on energy policy, including a council led by Interior Secretary Doug Burgum, “are getting screamed at to find some good news” on bringing down prices, the same executive said. “Folks are scrambling for announcements and messaging to counter the narrative” of rising prices, this person said.

A White House spokesperson did not answer questions, instead referring to a Wednesday briefing in which White House press secretary Karoline Leavitt told reporters that Treasury Secretary Scott Bessent and Burgum have “been long working on and well in advance” on oil and economic issues.

“I think it speaks to why this action was so necessary that ultimately the energy industry is going to benefit from the president’s actions with respect to Iran, because Iran will no longer be controlling the Strait of Hormuz and restricting the free flow of energy,” Leavitt said.

Some of the ideas the administration is considering include a temporary holiday on the gasoline tax, people familiar with the discussions said. But that might not bring immediate relief since it would require action from Congress. And there’s no guarantee oil refiners and gas stations would pass the savings along to drivers.

Some administration officials have also floated using the U.S. military to defend energy infrastructure in the Middle East. But that idea isn’t likely to win over Saudi Arabian officials, who are cool on it given the sensitivities around American boots on the kingdom’s soil.

Wright, who in recent months had been one of the administration’s loudest champions of low oil prices, took to social media to justify the military strike against Iran — but has so far not publicly broached the subject of energy prices since the attack.

That’s on purpose, said a third energy industry executive who talked to White House officials right after the U.S. attack began Saturday. Secretary of State Marco Rubio and other hawkish members of the administration were leading the administration’s planning, but other administration officials who would normally argue to keep oil prices low had initially been told to take a back seat while the fighting in Iran continues, this person said.

“The faction of the White House that would care about $80-90 oil [was] being silenced,” said this person, who was granted anonymity to discuss private conversations with the administration. ”There [were] louder voices winning at the moment.”

The concern for rising oil and natural gas prices brought by the war is a relatively new thing, said industry executives. The Trump administration did not start hitting the phones to discuss ways to calm oil and gas markets until several days after the attacks started and oil prices started rising.

National Energy Dominance Council Executive Director Jarrod Agen and White House Senior Energy Policy Adviser Brittany Kelm were in Poland when the bombing in Iran began on Saturday, two people familiar with the matter said. The pair, who were visiting an liquefied natural gas import facility, returned to the United States until Monday, these people said.

Burgum, head of the NEDC, is currently in Venezuela to discuss critical mineral mining.

Trump has shrugged off the price increases, saying on Tuesday that “if we have a little high oil prices for a little while, but as soon as this ends, those prices are going to drop, lower than even before.”

The administration subsequently on Tuesday rolled out two measures that helped calm energy markets, at least briefly. Trump announced the U.S. military would offer protection to ships traveling through the Strait of Hormuz after Iran’s Revolutionary Guard warned it would target tankers in the narrow passage. And Trump said he’d ordered the U.S. International Development Finance Corp. to provide insurance to shippers who had seen their coverage canceled as the fighting spread.

Wright was in Texas last week touting the drop in gasoline prices under Trump — a boast the president has made regularly, including at his State of the Union speech earlier this month. But in the past week, the average price has jumped more than 20 cents a gallon to nearly $3.20 — nearly 10 cents higher than on former President Joe Biden’s last day in office.

U.S. natural gas prices have seen only a modest increase, but prices for the fuel in Europe have spiked nearly 70 percent since Friday as Qatar, one of its key suppliers of LNG cargoes, halted production because of the war.

The increase in crude oil futures prices, which reached a high Tuesday near $78 per barrel, are pushing up the cost of gasoline and diesel and could become a drag on the economy if further disruptions to production emerge.

Iraq has already shut some of its oil production — and Saudi Arabia might be close behind — as Iran’s retaliatory attacks on the Strait of Hormuz have all but ended passage through the waterway carrying more than 20 percent of the global crude tanker shipments.