Biden calls on Congress to suspend the gas tax — Here’s what that means for prices at the pump

President Joe Biden called on Congress to temporarily suspend the federal gas tax as he tried to quell the surge in prices at the pump. According to experts, a suspension could provide some relief, but it could also cause demand to go up and cause a shortage.

It has become a problem for the administration ahead of the elections in November because consumers are getting hit with higher prices.

The price per gallon at gas stations is the most visible sign of the increase in gas prices. The national average went over $5 per gallon for the first time.

It has become a problem for the administration even though it has nothing to do with the policies of Biden.

The summer driving season coincides with the three-month suspension of the federal tax on gas and diesel. The federal tax on gasoline is 18 cents and on diesel is 24 cents.

The president wants states to suspend their gas taxes or find other ways to help consumers.

The White House said that a suspension would give Americans a little extra breathing room.

Patrick De Haan of GasBuddy said that if the bill is enacted it will help motorists. He said that the extent to which relief is felt will depend on wholesale prices. The wording and timing of any legislation will have an effect.

New York is an example, according to de Haan. At a time when fuel prices were going up, the state suspended its gas tax. Consumers didn't see much of a difference since the lower taxes were offset by higher wholesale prices

He said that if this were implemented today it would enhance the downside since gasoline futures have pulled back recently.

It is not clear if Biden has the support of Congress. The proposal is at a crucial time in the election campaign.

The president takes aim at oil and gas companies for their policies that prioritize profits over consumers. He called on the refinery to increase production. The industry says the Biden administration has policies that make it hard for them to increase output.

Gas prices are not controlled by the White House. The underlying price of oil, which is set on a global basis and has spiked above $100, makes up more than half of the cost of gasoline.

While a suspension would have little impact on consumers, it would lead to billions of dollars for oil companies, according to a professor at Harvard.

He said that the gas tax holiday would manifest itself almost entirely in the form of higher prices for producers instead of savings for consumers.

Jeff Currie said a gas tax holiday will lead to higher consumer demand. It is often said that the cure for high prices is high prices. It isn't a permanent measure that will address market imbalances.

The national average for a gallon of gas went above $5 for the first time. The national average for a gallon of gas fell to $4.955 on Wednesday. In the last month, it has increased by 36 cents and by 18 cents compared to last year.

Since 1993, the federal gas tax has gone up.