The News4JAX Trust Index team is checking out a statement made by President Joe Biden regarding the high prices of gas and groceries and who is at fault.
The president has been calling the inflation Americans have been feeling the “Putin price hike,” but is Russian President Vladimir Putin solely to blame after invading Ukraine?
Biden has been using this narrative a lot lately, most recently referring to the “Putin price hike” on Tuesday while he was in Iowa unveiling his plan to reduce gas prices. Biden used the phrase nearly half a dozen times Tuesday, talking about rising inflation:
“I’m doing everything in my power to bring by executive orders to bring down the price and address the Putin price hike.”
“Putin’s invasion of Ukraine has driven up gas and food prices over the world.”
″To help deal with the Putin price hike, I’ve authorized the releasing one million gallons per day from the oil preserve.”
Biden’s narrative was quickly attacked by conservatives, including Florida Gov. Ron DeSantis, who blamed inflation on “federal policies of borrowing and printing money at unfathomable levels and poor energy policies.”
Brad Polumbo of the Libertarian Foundation said, “Gas prices have been rising for almost nine months before the invasion began, and prices overall have been rising since May 2021.”
News4JAX reached out to financial advisor Joe Krier, with IIWII Trading, who says gas prices were rising long before Russia invaded Ukraine. He also says American policies on oil companies also played a role.
“We had policies in place that were restricting permits or dragging their heels on permits and new fees, new regulations, new penalties, that made it much more of a gamble for a U.S. oil production company to start a new project until they saw things settling down or at least evening out a little bit,” Krier said.
Krier points out that during the COVID-19 pandemic, demand for oil was down, but it rebounded faster than oil producers expected.
A look back reveals:
- In the last three months of the Trump administration, oil prices rose by 32% as demand bounced back.
- And in the first three months of the Biden administration, oil prices rose by another 19%.
Both presidents approved COVID-19 stimulus money, which put more money in people’s pockets and contributed to increased demand for gas and also drove up inflation.
Krier says Russia’s February invasion of Ukraine and Biden’s decision to cut ties with Russian oil companies only made a bad situation worse.
“There’s a lot of factors at play here. And, definitely, the invasion of Ukraine was a factor. It’s created chaos in pricing. And for a little while, every time Putin made a headline statement, it made the price of oil bounce up or down. But really, this is more about production and production either coming back online or being delayed for various reasons,” Krier said.
So to the president’s claim that the high price of gas and groceries is a “Putin price hike,” the News4JAX Trust Index team rates this claim as “be careful.” While Ukraine is one of the biggest producers of grain, impacting food prices, and cutting ties with Russian oil companies did contribute to inflation, gas prices were rising long before the Ukrainian invasion, primarily from growing demand.