Lawmakers still haven’t agreed on a form of relief from high gas prices. (NBC12)
President Joe Biden authorized on Tuesday the release of 30 million barrels of oil from the Strategic Petroleum Reserve, part of an international boost to the global oil supply that has been disrupted by Russia’s invasion of Ukraine.
The reserve is a complex of four sites with deep underground storage caverns in salt domes along the Louisiana and Texas Gulf Coasts.
The U.S. contribution will make up half of the reserve oil that the International Energy Alliance, a collection of 31 mostly European countries that also includes the United States, agreed to collectively release, White House press secretary Jen Psaki said in a statement.
The release is meant to counteract Russian President Vladimir Putin’s “weaponization of oil and gas,” Psaki said.
“Today’s announcement is another example of partners around the world condemning Russia’s unprovoked and unjustified invasion of Ukraine and working together to address the impact of President Putin’s war of choice,” Psaki said.
Russia’s oil and gas sector is the most significant piece of its economy that the U.S. has not sanctioned after Russia invaded Ukraine last week.
Since the fighting began, Biden has often repeated he is seeking to minimize the impact to U.S. consumers, including curbing any rise in prices at gas pumps.
The war has already led to a disruption of the global energy market, Biden said in a memorandum authorizing the release.
“Russia’s actions in Ukraine have resulted in energy supply shortages of significant scope and duration and have already caused a substantial increase in oil prices worldwide,” the memo reads.
Energy Secretary Jennifer L. Granholm said the administration may draw down more from the reserve if the conflict persists.
“We stand prepared to take additional measures if conditions warrant,” she said in a statement.
The Energy Department reported the reserve held about 588 million barrels as of the end of January.
Releasing oil from the Strategic Petroleum Reserve is one of only a few options policymakers have to contain the price of energy supplies, Patrick De Haan, the head of petroleum analysis for the gas price-tracking company GasBuddy, said in an interview last week.
But a one-time release is not particularly effective at keeping prices in check, De Haan said, and it’s also not the actual purpose of the reserve.
“Unless there’s an actual physical disruption, the SPR should be used for its intended purpose,” he said. “It’s the strategic petroleum reserve, not the price reduction reserve.”
U.S. domestic oil consumption was about 18 million barrels per day in 2020, according to the U.S. Energy Information Administration.
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