President Joe Biden on Tuesday announced that in a desperate attempt to bring down prices at the pump, he is tapping into the U.S. Strategic Petroleum Reserve (SPR) for 50 million barrels of oil.
“The move is aimed at global energy markets, but also at U.S. voters who are coping with higher inflation and rising prices ahead of Thanksgiving and winter holiday travel,” the Associated Press reported.
The move, however, will not have an immediate effect.
The government is deciding not to move the barrels into the market until mid- to late-December. And even then, not all of the oil will hit the market. Biden said 32 million barrels will eventually be returned to the SPR, with the other 18 million authorized for sale by Congress.
“The actions are unlikely to immediately bring down gas prices significantly as families begin traveling for the holidays. Administration officials noted that gasoline usually responds at a lag to changes in oil prices, and they suggested this is one of several steps in ultimately bringing down costs,” the AP reported.
The White House said China, India, Japan, South Korea, and the United Kingdom will also tap into their petroleum reserves as part of a coordinated effort. “This culminates weeks of consultations with countries around the world, and we are already seeing the effect of this work on oil prices. Over the last several weeks as reports of this work became public, oil prices are down nearly 10%,” the White House said.
Biden’s half-hearted attempt to remedy the skyrocketing gas prices which he himself created drew an underserving amount of praise from senior Democrats, including Senate Majority Leader Chuck Schumer.
“President Biden’s announcement is good news for American families and will strengthen our economy,” Schumer said. “Tapping the SPR will provide much-needed temporary relief at the pump and will signal to OPEC that they cannot recklessly manipulate supply to artificially inflate gas prices. Of course, the only long-term solution to rising gas prices is to continue our march to eliminate our dependence on fossil fuels and create a robust green energy economy.”
Prices at the pump have been rising steadily since Biden took office. GasBuddy.com, a price-tracking website, said Monday that gas prices have hit an average of $3.39 per gallon. Gas is $1.30 per gallon higher than a year ago, the site noted.
To make matters worse supply is also dwindling. “According to data from the Energy Information Administration last week, U.S. crude oil inventories fell 2.1 million barrels and stand 7% below the five year average for this time of year, while domestic crude oil production also saw a slight drop to 11.4 million barrels per day,” GasBuddy reported.
“Gasoline inventories fell by a slight 700,000 barrels and stand 4% below the five year average range, while distillate inventories also declined by 800,000 barrels and stand 5% below the five year average range. Implied gasoline demand, a proxy for retail gasoline demand, fell 18,000bpd to 9.24 million barrels per day. Refinery utilization continued to rally, posting a rise of 1.2 percentage points to 87.9% nationally,” the website added.
Former President Donald Trump said Tuesday that President Joe Biden is raiding strategic oil reserves because he is “at the mercy of OPEC” to reduce gas prices for American consumers.
“I understand that Joe Biden will be announcing an ‘attack’ on the newly brimming Strategic Oil Reserves so that he could get the close to record-setting high oil prices artificially lowered,” Trump said in a statement. “Those reserves are meant to be used for serious emergencies, like war, and nothing else.”
Trump, who made it a goal to become energy independent during his tenure, slammed Biden’s reliance on OPEC instead of American producers.
“We were energy independent one year ago, now we are at the mercy of OPEC,” Trump said, “gasoline is selling for $7 in parts of California, going up all over the Country, and they are taking oil from our Strategic Reserves.”
“Is this any way to run a Country?” he asked.
Trump also stated he refilled the United States’ depleted oil reserves while gas prices were lower and America was energy independent. “I filled them up three years ago, right to the top, when oil prices were very low,” he said.
Author: Charles Lisek