Oil prices have increased by approximately 13% over an 11-day period, concluding on Monday. This surge follows escalating conflicts in the Middle East, creating uncertainty about future costs as Election Day approaches.
While oil prices spiked, they fell on Tuesday after nearly a week passed without a widely anticipated Israeli counterattack on Iran. Experts suggest the rising oil prices could have implications for the presidential election next month. Typically, when crude oil prices rise, gasoline prices follow, which can significantly influence public opinion, according to analysts at ABC News.
Currently, the increase in oil prices is not substantial enough to affect the election, experts believe. However, they caution that further spikes in the coming weeks could negatively impact consumer sentiment and lower approval ratings for Vice President Kamala Harris, whose party currently holds the White House.
Denton Cinquegrana, chief oil analyst at the Oil Price Information Service, explained, “People use gasoline as a gauge of the economy and how they’re feeling about it.” He added that a small price increase may not be significant, but if the cost of a gallon of gas rises by 50 cents, it would capture attention. Although such an increase is possible, it is deemed unlikely.
Some experts question whether even a sharp rise in oil and gas prices would impact voter sentiments regarding Harris. Jon Krosnick, a Stanford University political science professor, noted that voters tend to assess the economy over the long term rather than focusing on short-term fluctuations.
In the wake of recent attacks on Israel by Iran, analysts indicated that oil prices could push gasoline costs up by 10 to 15 cents per gallon. However, experts assert that this moderate increase would likely not influence the election, as consumers would not be significantly bothered by it.
Cinquegrana expressed skepticism about a substantial price increase, suggesting, “I do suspect that prices are going to continue to move higher, but I don’t think it will be significantly higher. Unless something really goes haywire, I don’t expect prices to spike ahead of the election.”
Experts believe that slight increases in gas prices may not concern consumers much, especially since prices at the pump have decreased significantly over the past year. Recent trends show that fuel prices have dropped due to lower gas demand as the busy summer travel season transitions into a slower autumn. Currently, the average price for a gallon of gas is about 15% lower than it was a year ago, according to AAA data.
Despite recent increases, oil prices remain below the peaks reached in 2022, when a robust economic recovery from the pandemic coincided with supply shortages caused by the Russia-Ukraine war. However, a major escalation in the Israel-Iran conflict could lead to significant increases in oil and gas prices, according to analysts, who warn of the potential for dire consequences from an anticipated retaliatory strike by Israel.
Sanctions have limited Iranian oil production in recent years, but Iran maintains control over the Strait of Hormuz, a critical passage for about 15% of the world’s oil supply. Analysts warn that intensifying conflict could restrict Iranian oil production or transport through this key route, potentially driving prices upward.
Jim Burkhard, vice president and head of research for oil markets, energy, and mobility at S&P Global, remarked, “The risk of a wider war in the Middle East has gone up. There’s the risk of something happening that could lead to higher prices.” An increase in oil prices would likely result in soaring gas prices, which could negatively impact Harris’s political prospects if voters blame the Biden administration for rising costs just before the election, said Carola Binder, an economics professor at the University of Texas at Austin.
Binder stated, “If there was a huge increase in gas prices, I could imagine that hurting Harris’s chances. Consumer sentiment does affect elections.” However, Krosnick disagreed, emphasizing that voters may not hold Harris responsible for the Middle East conflict leading to potential price increases. He also pointed out that there isn’t enough time for significant price changes to impact voter opinions ahead of the election.
Krosnick’s research, co-authored in 2016, found that rising gas prices historically correlate with decreased presidential approval ratings. The study indicated that each 10-cent increase in gas prices corresponded to over a half percentage point decline in presidential approval. However, Krosnick highlighted that the current situation is different, as his research focused on long-term trends rather than sudden spikes in prices.
“There isn’t enough time for there to be a sustained change in prices,” Krosnick concluded. “It takes a while to ripple out to consumers.”
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