Can gasoline get back to $2.50? We FuelFact it

FuelFact is a new project of FuelFix.com. In the runup to the 2012 presidential election, a lot is being said about the rising price of gasoline. We’ll be evaluating these statements, consulting with experts and rating their accuracy.

Inspired by sites like PolitiFact.com and FactCheck.org, our staff will judge the statements on our “truthiness” gas gauge:

  • Full: The statement is accurate.
  • Three-quarters Full: The statement is accurate but needs clarification or additional information.
  • Half-Full: The statement is partially accurate but omits important details or takes facts out of context.
  • Quarter-Full: The statement contains an element of truth but ignores critical facts.
  • Empty: The statement is not accurate.

We’ll kick off the project by looking at Republican candidate Newt Gingrich’s promise to deliver $2.50 a gallon gas.

SUMMARY

Gingrich said skyrocketing gasoline prices could be brought down to around $2.50 by doing four things: increasing domestic production, opening offshore drilling, approving the Keystone XL pipeline and removing bureaucratic red tape.

Gingrich has used the topic as the backbone of a new campaign ad and refused to back off his claims, despite rebukes from Democrats and the White House that say his plan is phony.

“I’ve developed a program for American energy so no future president will ever bow to a Saudi king again and so every American can look forward to $2.50-a-gallon gasoline,” Gingrich said.

So, does Gingrich have the silver bullet for reducing the price at the pump for consumers?

ANALYSIS

Analysts have long said the president — regardless of political party — can have a limited impact on the price of gasoline since it is a globally traded commodity, and Gingrich’s plan isn’t blazing a new path.

Republicans leaders have been calling for months for the Obama administration to increase domestic production by removing red tape and opening more waters for offshore drilling. The Keystone XL pipeline has long been debated for its potential impact on U.S. jobs and prices at the pump.

Patrick DeHaan, a senior analyst for GasBuddy.com, said the points might be good for political fodder, but they are unlikely to make a significant impact on the price of gasoline. And it’s unrealistic to think the four points could bring gasoline to $2.50 or lower.

“If these ideas would actually work, you’d already see politicians using them,” he said.

If the United States tapped offshore fields in the Atlantic, Pacific and the Alaskan National Wildlife Refuge, it would represent only a drop in the bucket to the worldwide oil consumption, which is around 85 to 90 million barrels a day.

“If we drill in the middle of Manhattan and everybody drilled in their backyard we would not have enough oil to move the global market,” Fadel Gheit, a senior analyst for Oppenheimer & Co. Inc., told CBS News.

Production from those fields could take years to come online and likely wouldn’t bring any short-term or long-term relief for consumers, DeHaan said.

However, DeHaan said the Keystone XL could potentially lower gasoline for some U.S. drivers. He said the pipeline could lower prices by 15 to 20 percent, but even with those predictions, Houston, Texas and national gasoline prices would still be over $3 per gallon.

The ripple effect from the pipeline could also cause higher prices in the Rockies and the Midwest, which are already benefiting from discounted crude from Canada.

RATING

Gingrich could possibly slightly lower prices for consumers, but analysts say it would be tough for him to get down to $2.50. Our FuelFact “truthiness” rating: According to analysts, this claim is hitting empty on the facts.

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