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Gas Prices Remain Above $3 Nationwide Despite Trump’s Claims of $1.98 Gallons
Despite repeated claims by former President Donald Trump that gasoline prices have fallen to “$1.98 a gallon” in many states, the national average for regular gasoline remains firmly above $3 per gallon, with no state showing average prices below $2.60.
Since mid-April, Trump has made several statements suggesting dramatically lower gas prices than what consumers are actually paying at the pump. During a recent “Meet the Press” interview aired on May 5, he stated, “Prices are down at tremendous numbers for gasoline. It went up to $3.90, even $4. And in California, $5 and $6. Right? Okay. I have it down to $1.98 in many states right now.”
When initially questioned about these claims, the White House did not provide supporting evidence. However, CNBC has since reported that Trump appears to be referencing the trading price for RBOB (reformulated blendstock for oxygenate blending), not consumer-facing retail prices.
According to CNBC energy reporter Spencer Kimball, “When asked by CNBC whether the president was referring to RBOB, Trump administration officials pointed to the contract’s recent price action,” noting the commodity had dropped below $2 per gallon in trading.
RBOB is an unfinished gasoline product that requires blending with oxygenates like ethanol to produce the finished fuel consumers purchase. It’s traded as a commodity on markets like the New York Mercantile Exchange, where contracts briefly sold between $1.96 and $1.99 per gallon for several days in April, down from approximately $2.11 when Trump took office in January.
Patrick De Haan, head of petroleum analysis at GasBuddy, emphasized to CNBC the disconnect between these wholesale commodity prices and what consumers actually pay. “It does not come anywhere near explaining what consumers are paying,” De Haan said. “It would be irrelevant to the consumer to know what the price of RBOB is because they’re not paying the wholesale price of RBOB.”
The RBOB price excludes critical components that determine final consumer prices, including federal and state taxes, as well as manufacturing, distribution, and marketing costs. This creates a significant gap between the commodity price Trump appears to be referencing and the actual price consumers see at gas stations.
According to the Energy Information Administration (EIA), the national average price for regular gasoline was $3.15 per gallon for the week ending May 5, slightly higher than the $3.11 average when Trump began his second term earlier this year. For context, gas prices had reached as high as $5 per gallon in 2022 during global energy market disruptions.
State-level data from AAA shows Mississippi currently has the nation’s lowest average price at approximately $2.65 per gallon – still significantly higher than the $1.98 figure Trump has claimed. GasBuddy’s tracking confirms these figures.
Energy market experts consistently note that presidents have limited direct influence over gasoline prices. The cost is primarily determined by global crude oil prices, which respond to worldwide supply and demand factors beyond any single government’s control.
This isn’t the first time Trump has used wholesale commodity prices instead of retail prices when discussing consumer goods. He has made similar claims about egg prices, comparing wholesale trading prices to previous retail prices in ways that don’t accurately reflect consumer costs.
The discrepancy highlights the importance of distinguishing between commodity trading prices and retail prices when discussing consumer goods, particularly those like gasoline that incorporate significant taxes and distribution costs beyond the raw material price.
As summer driving season approaches, analysts will be watching how gasoline prices respond to increased demand, though few expect prices to approach the $1.98 level claimed by the former president anytime soon.
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8 Comments
This highlights the importance of fact-checking political claims, especially around economic data that directly impacts people’s daily lives. Retail gas prices are a complex issue with many factors at play.
It’s interesting to see the discrepancy between Trump’s claims and the actual national gas price average. I wonder what factors are driving the continued high prices despite the administration’s assertions.
You’re right, the data doesn’t seem to support Trump’s specific price claims. Retail gas prices are complex and depend on many factors beyond just the wholesale RBOB price he may be referencing.
While I understand the desire to highlight lower commodity prices, it’s important to ground claims in verifiable facts. Retail gas prices have many moving parts beyond just the wholesale fuel cost.
Agreed, cherry-picking data points without full context can be misleading. A nuanced look at the drivers behind gas prices would provide more meaningful insight for consumers.
Interesting to see the disconnect between Trump’s statements and the actual national average gas price. I wonder what role factors like refining capacity, distribution, and taxes play in keeping prices elevated.
Yes, the wholesale price is just one piece of the puzzle. Examining the full supply chain dynamics would give a more complete picture of what’s driving current gas prices.
While lower commodity prices are certainly positive, it’s crucial that political leaders ground their claims in verifiable data. Retail gas pricing is complex, with many variables beyond just the wholesale fuel cost.