For someone who has helped foster a domestic energy renaissance, President Trump’s recent Truth Social post evoked a surprising amount of Elizabeth Warren’s rhetoric. That was my first thought reading the president’s claim that energy companies are ripping off consumers over gasoline prices. Nothing could be further from the truth. Gasoline prices remain elevated due to current economic and geopolitical reasons, particularly the conflict with Iran—not price gouging.
As we move closer to normal commercial flows in the Middle East, prices at the pump have declined nearly every day over the past month and are now back under $4 a gallon. That’s about 50 cents less than the mid-May high. Spending less on gas is a welcome reprieve for American drivers who have been understandably frustrated paying more at the pump compared to the start of 2026 when gas was at a five-year low.
It’s impossible to predict where prices will be over the next few months but it’s likely the decline will continue through the summer so long as tankers can safely transit both ways through the Strait of Hormuz, a critical choke point through which more than 20% of the world’s oil travels. If that happens, oil should flow at levels close to where they were pre-conflict.
That should give Americans a level of optimism that lower oil prices will translate to lower gas prices over time. Gasoline prices often lag the price of oil by a few weeks due to when the oil gets refined and transported to gas stations. Those price fluctuations are a matter of timing and when gas stations refill their storage tanks, which is why one station might have a different price compared to one around the corner.
With oil now below $70 a barrel (as of this writing), there is still runway left for gasoline to drop more than where it is now. It may take slightly longer than Americans would prefer, but that is how market forces work.
Energy is an incredibly volatile sector as it is, and like every other market, prices are determined by the amount of supply compared to demand. The demand for energy has never been higher, while the Iran conflict has created a supply shortfall of over 10 million barrels of oil per day, which has pushed prices much higher compared to pre-conflict. Major supply disruptions anywhere will lead to price increases everywhere.
Thankfully, the United States has experienced a massive increase in production and American energy companies have been able to keep prices in check compared to other developed countries in Europe and Asia. A major reason for this is President Trump’s energy dominance agenda, which has encouraged investment into American oil fields due to lower taxes, less red tape, and certainty for project permits. Thanks to these efforts, America is producing more oil than it ever has.
Unfortunately, some progressive members of Congress want to move in the opposite direction by imposing a crippling Windfall Profits Tax (WPT). Reposting the president’s Truth Social post, Senator Whitehouse (D-RI) highlighted his support for a 50% tax rate on oil companies. If enacted it would ultimately punish American consumers with higher prices and depress energy production.
The basic flaw in a windfall profits tax is straightforward: if you tax something, you get less of it. Imposing punitive taxes on domestic energy production discourages future investment in exploration, drilling, refining, and infrastructure. Companies respond rationally to incentives and penalties. When the government signals that higher production and successful investment will simply be punished with new taxes, fewer projects get financed and less energy gets produced over time.
That means less supply, which ultimately means higher prices for consumers.
Americans deserve real, proven solutions to lowering energy prices. These should include bipartisan permitting reform, smarter tax policy, and fewer regulatory burdens that make it harder to explore, produce, transport, and refine the fuel that powers our modern way of life. Demonizing American energy companies that are actively working to increase domestic energy production—and thereby lower prices—is a backward approach to this pressing challenge.