Oil has sort of been on a wild ride. Back in June — with global supply uncertain due to Russia’s ongoing war in Ukraine and energy demand running hot as economies recovered from the pandemic — the price of crude shot up to $120 a barrel. Through the summer, we were paying as much as $4.50 to $5 a gallon at the pump.

Prices have moderated since then. AAA said the nationwide average for regular gas is now about $3.80 a gallon.

But OPEC+ has pledged to cut production to raise global crude prices.

In response, the Joe Biden administration is releasing oil from the nation’s Strategic Petroleum Reserve to keep prices down. It’s pledged to replenish those reserves by purchasing oil in a fixed price range — $67 to $72 a barrel when prices drop — to encourage more domestic production.

Releasing millions of barrels of oil from the Strategic Petroleum Reserve increases supply now, and promising to buy new oil at a profitable price gives domestic producers an incentive to boost output in the future. 

But Peter McNally at Third Bridge said there are big questions about whether the industry can or will deliver.

“The ‘can’ is a question of supply chain, and the ‘will’ is more about shareholders,” he said.

McNally said there’s a shortage of drilling equipment and rig operators, and investors don’t have much appetite for another boom-bust cycle.

“There has been more attention to dividends and [stock] buybacks, shoring up balance sheets, rather than every time the oil price rallied or someone says they need more oil, punching more holes in the ground,” he said.

Gasoline price have stressed out American consumers, said Joanne Hsu, director of surveys at the University of Michigan.

“Consumer sentiment is close to historic lows right now, and that’s primarily because of high prices,” she said.

As gas prices edged down this summer, sentiment improved — a bit. 

But Hsu said it’s not policy announcements about prices that consumers pay attention to.

“There are probably a small share of consumers responding to news events, the OPEC movement or releasing oil from the Strategic Reserve,” Hsu said. “But I would say that’s moving the needle much less than actual prices that people are seeing at the pump.”

Prices that are about 40 cents a gallon higher than a year ago.