President Joe Biden is authorizing the release of 50 million barrels of oil from the Strategic Petroleum Reserve in a bid to lower soaring...
President Joe Biden is authorizing the release of 50 million barrels of oil from the Strategic Petroleum Reserve in a bid to lower soaring prices Americans are paying at the pumps, The White House announced on Tuesday.
Biden is working with India, South Korea, China, and Japan to tap from their resources after OPEC+ nations in the Middle East rebuffed his pleas to pump more oil.
It is a dramatic move that hasn't been used since the aftermath of Hurricane Katrina, experts believe it is just a short-term fix to the soaring costs and Republicans said Biden was trying to desperately fix an emergency he has created.
He is taking oil from the reserve, which has 604.5 million total barrels across four sites in Louisiana and Texas, with gas prices at a seven-year-high, inflation hitting historic records and America facing a winter heating crisis.
Oil prices rose towards $81 a barrel on Tuesday morning after the announcement to try to and cool the market falling short of some expectations. Americans will likely not see a change in prices at the pump for at least another two weeks.
Presidents typically tap oil reserves when emergencies or natural disasters disrupt the supply chain, although more recently have even tapped them to keep prices in check from time to time.
The last time that the oil reserve was tapped in the U.S. was as oil prices surged in the aftermath of Hurricane Katrina. At the time, then-President George Bush ordered 30 million barrels be released.
The average price of gasoline recently breached a seven-year high, and now costs $3.409 per gallon, according to AAA. In California, residents have reported paying up to $4.84 a gallon.
The Consumer Price Index is up 6.2 per cent over last year, and rose 0.9 per cent in October alone, tanking public trust in the president.
Following a presidential announcement for the release of oil, it usually takes 13 days to hit the market, according to the Energy Department.
Experts have predicted it could take two weeks for the prices to start dropping, but have also warned it is not a long-term solution because it doesn't solve supply and demand problems in the aftermath of the pandemic.
Biden will formally announce the move to release reserve oil in a speech on Tuesday afternoon aimed at addressing the economy and lowering prices. Later Tuesday evening the president and first lady will leave Washington, D.C. to spend Thanksgiving with family in Nantucket, Massachusetts.
President Biden is authorizing the release of 50 million barrels of oil from the Strategic Petroleum Reserve in a bid to lower soaring prices Americans are paying at the pumps, The White House announced on Tuesday
The average price of gasoline recently breached a seven-year high, and now costs $3.409 per gallon, according to AAA. In California, residents have reported paying up to $4.84 a gallon
Prices for a gallon of gas are highest in west coast states and in the North East, according to AAA. They are lowest in south central states like Florida, Louisiana and Mississippi where prices range from $2.97 - $3.15
'American consumers are feeling the impact of elevated gas prices at the pump and in their home heating bills, and American businesses are, too, because oil supply has not kept up with demand as the global economy emerges from the pandemic,' The White House said in a statement released Friday morning.
'That's why President Biden is using every tool available to him to work to lower prices and address the lack of supply.
'Today, the President is announcing that the Department of Energy will make available releases of 50 million barrels of oil from the Strategic Petroleum Reserve to lower prices for Americans and address the mismatch between demand exiting the pandemic and supply.'
Eighteen million barrels will be part of an accelerated release from previous sales and 32 million will be released as an exchange to be 'replenished' at a later date, the White House said.
Biden has already faced a lot of criticism over revoking a key permit upon taking office in January that suspended construction of the Keystone XL Pipeline. His administration has also threatened to close the Michigan Five Pipeline.
Republicans immediately weighed in on the announcement of tapping the reserve, claiming this emergency measure should be taken during war time.
Former President Donald Trump called it an 'attack' on the oil reserve.
'For decades our Country's very important Strategic Oil Reserves were low or virtually empty in that no President wanted to pay the price of filling them up. I filled them up three years ago, right to the top, when oil prices were very low,' Trump praised his administration in a statement Tuesday morning.
'Those reserves are meant to be used for serious emergencies, like war, and nothing else,' he wrote. 'Now 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.'
'We were energy independent one year ago, now we are at the mercy of OPEC, 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?'
It appears Trump's claim that he helped add to the reserve during his time as president is not true.
According to the U.S. Energy Information Administration, the national Strategic Petroleum Reserve stockpile went from 695 million barrels in January 2017 to 638 million in January 2021 – the same timeline Trump entered and left office.
Gas prices are surging nationwide – reaching some of the highest levels in California. A Chevron stations shows a gallon of gas at $5.09 in Visalia, California on November 16 (left) and a SevenEleven shows the price per gallon at $3.33 in Miami, Florida on November 22 (right)
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