Gas taxes rise by 7% in Virginia starting on July 1. The Roanoke Star reports:
Virginia’s gasoline and diesel taxes will rise 7% on July 1, about three more cents per gallon when all the elements of the tax are combined. This is the inflation-driven cost of living adjustment which Governor Glenn Youngkin (R) and most legislative Republicans tried to short circuit, but which was preserved by a vote in the Virginia Senate last week.
The new gasoline tax will be 28 cents retail, 8.2 cents wholesale plus another 0.6 cents per gallon to fund a program for removing old underground tanks safely. That’s a combined tax of 36.8 cents per gallon. The taxes on diesel will be 28.9 cents retail, 8.3 cents wholesale plus the same tank fee, a total of 37.8 cents per gallon.
In 2020, SB890 was passed by the Democratic-controlled Virginia General Assembly. It requires the gas tax to increase when inflation goes up. But gas prices in Virginia, which currently average about $4.69 per gallon of regular gas, will likely remain about fifteen cents below the national average even after the tax increase goes into effect.
The average price for gasoline nationally could rise to as much as $6 later this summer, said Tom Kloza, global head of energy analysis for the Oil Price Information Service. That’s due to growing demand for gas as people hit the road for long-planned vacations. “Come hell or high gas prices, people are going to take vacations.” The highest statewide average is in California, where the average is at about $6.30 a gallon. In one California county, gas prices are closer to $10.
CNN reported that there are “signs that people are starting to cut back on their driving in the face of the higher prices, but it’s still a modest decline. The number of gallons pumped at stations in the last week of May was down about 5% from the same week a year ago.”
Gas prices have more than doubled since Joe Biden took office. The Biden administration caused gas prices to rise even faster by taking actions to cut oil production, making oil more scarce. On taking office, Biden issued a slew of executive actions suspending oil and gas leases, as CNBC reported in January 2021.
Earlier this year, in a gaffe publicized by conservative media, Biden celebrated the high gas prices Americans now face as part of an “incredible transition” away from fossil fuels. A recent poll found that a majority of Americans — including most independents — think the Biden administration has intentionally taken actions that increase gas prices, in order to push Americans away from using fossil fuels.
The public has become become angry over high gas prices, and Biden’s approval ratings have fallen in the polls. In response, Biden has belatedly taken steps to distance himself from rising gas prices, such as releasing gas from the Strategic Petroleum Reserve. But As the Daily Caller reported, gas prices rose not long after every release of oil from the strategic oil reserve. That means the releases achieved nothing except leaving less in the reserve to cope with any future emergency.
As the Heritage Foundation observes, Biden earlier took many steps to reduce the supply of oil, which will keep oil prices high:
At first, Mr. Biden patted himself on the back for his plans to restrict oil and natural gas-based energy. Now that gasoline prices are really taking off, however, he denies that he has slowed domestic oil drilling.
But he has…..On Mr. Biden’s first day in office, he issued an executive order directing the Secretary of the Interior to put a …. moratorium on the Coastal Plain Oil and Gas Leasing Program. That program directs the Bureau of Land Management to lease certain lands in Alaska for oil and gas extraction.
A few days later, he issued another order “pausing” oil and gas leases on all public lands and waters.
According to the Bureau, Alaska’s Coastal Plain is “some of the most highly prospective land on Alaska’s North Slope.” It contains billions of barrels of oil and trillions of cubic feet of natural gas. It is a king’s ransom of energy wealth, and the law requires that the administration make it available for extraction….The result: Mr. Biden has unlawfully trapped much of America’s vast energy reserves behind a wall of bureaucratic red tape, leaving them unavailable now that the country needs them.
Biden has released some more oil from the Strategic Petroleum Reserve to make it look like he is trying to do something about gas prices. But the reserve is so tiny that it contains far less than a month’s worth of oil, too little to affect gas prices for long (a week ago, it had less than 500 million barrels of oil in it).
It’s just too small to affect gas prices for even a few months, because Democrats blocked refilling and expanding the Strategic Petroleum Reserve in 2020, when oil was cheap enough to do that at little expense. In March 2020, President Trump proposed adding oil to the Strategic Petroleum Reserve when oil cost only $14 per barrel, but Democrats blocked him from doing that. Now, oil is more expensive, over $110 per barrel. The price of a barrel of Brent Crude oil is nearly $120 per barrel.
Not buying oil back in 2020 cost the U.S. government the opportunity to make tens of billions of dollars reselling the oil today for at a profit of around $100 per barrel. That could have reduced the national debt, and had a modest effect on gas prices, too.
If Congress had authorized the purchase of several hundred million barrels of oil for $14 back in 2020, the federal government could sell that oil today for $110-$120 per barrel, making tens of billions of dollars in profits.
But the oil reserve is nowhere near full, and no effort was made to expand its capacity when oil was cheap. The Strategic Petroleum Reserve was already at its lowest level in 20 years, even before Biden’s most recent release of oil from the reserve. Critics have argued that Biden’s prior releases of oil were illegal under the 1975 Energy Policy and Conservation Act, because they weren’t in response to an emergency.
