• Gasoline inventories have fallen to critically low levels, with officials from major oil companies warning the White House that pump prices could spike sharply in the coming months.
  • The warning adds pressure on the administration to address energy-driven inflation, which is already straining U.S. consumers.
  • Industry leaders are urging policy action, including potential releases from strategic reserves and regulatory adjustments, to mitigate the impact.

Inventory Squeeze Prompts Industry Alert

Senior executives from several of the nation's largest oil and gas companies delivered a stark message to the White House this week: gasoline prices are likely to rise further, and soon. According to people familiar with the matter, the executives cited dwindling fuel inventories that have reached seasonal lows, leaving the market with little buffer against supply disruptions or demand spikes. The warning came during a series of private meetings and calls with administration officials, who are grappling with persistent inflation ahead of the summer driving season.

U.S. gasoline stockpiles have slid to their lowest level for this time of year in nearly a decade, according to industry data reviewed by the executives. Global inventories of crude and refined products are also dangerously thin, with some traders describing conditions as near "tank bottom." The executives stressed that without a swift policy response, consumers could face a sudden jump in prices at the pump, exacerbating broader inflationary pressures.

Administration's Dilemma

The White House has acknowledged the discussions, with a spokesperson saying the administration is "monitoring the situation closely and considering all tools available to ensure affordable energy for American families." However, options are limited: releasing more barrels from the Strategic Petroleum Reserve could provide temporary relief, but the reserve is at its lowest level in decades after last year's historic drawdown. Refiners are also running near capacity, and any unplanned outage could tighten supply further.

Industry insiders say the administration is also exploring ways to boost refinery utilization and ease regulatory bottlenecks, though such measures would take time to have an effect. "You've got a system that's already stretched, and any hiccup — whether it's a hurricane, a refinery fire, or geopolitical tension — could send prices through the roof," one executive said, speaking on condition of anonymity to discuss sensitive conversations.

Broader Market Pressures

Gasoline prices have already risen about 15% this year, averaging $3.60 per gallon nationally, according to AAA. The warning from executives suggests that trend could accelerate. Futures markets are echoing the concern: gasoline futures have surged to multi-month highs, and the spread between gasoline and crude oil — a measure of refining profit — has widened sharply, signaling expectations of tight supply.

The situation has drawn comparisons to 2022, when gasoline prices hit record highs above $5 per gallon, stoking public anger and political backlash. Analysts caution that the current inventory squeeze could be even more acute if demand picks up as expected during the summer. "The margin for error is very small right now," said a veteran energy analyst. "Any additional disruption could have outsized price effects."

What's Next

The White House is expected to convene further meetings with refiners and traders in the coming days. Meanwhile, the industry is urging the administration to consider temporary waivers on fuel blending requirements, known as Reid Vapor Pressure rules, to ease supply constraints. But any policy change will likely take weeks to implement — time that the market may not have.

Correction: An earlier version of this article misstated the timeline of previous gasoline price peaks. The record was in 2022, not 2021.