US to release 50M barrels from strategic oil reserve amid soaring gas prices
gas prices and soaring inflation, the White House announced Tuesday.
Thirty-two million barrels will be released from the Strategic Petroleum Reserve over the next several months and will be replaced in the years ahead. Another 18 million barrels that Congress already had authorized for sale will be released in the coming months.
“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.
inflation, which last month hit a 31-year high. Republicans have blamed Biden’s policies for the increased cost of consumer goods, including energy prices, while Democrats have pointed to other positive economic indicators, like declining unemployment.
Higher gas prices:Thanksgiving travelers will pay more but they’ll still hit the road
How to save at the pump:As gas prices soar, here are tips to help find cheap gas with your smartphone
Gas prices have risen this fall
The decision to dip into the nation’s strategic stockpile comes as gas prices rose steadily for the past few months before leveling off last week.
Average gas prices fell this week for the second straight week, dropping 1.9 cents from a week ago, according to the fuel-price website GasBuddy. The average price stands at $3.39 per gallon, according to data that GasBuddy compiled from more than 11 million individual price reports covering over 150,000 gas stations across the country.
called last week for federal regulators to investigate whether oil and gas companies are engaging in “illegal conduct” by profiting from high gas prices that have skyrocketed during the pandemic. He requested the probe in a letter to Federal Trade Commission chair Lina Khan, claiming “mounting evidence of anti-consumer behavior by oil and gas companies.”
More:Inflation hit a 31-year high in October, but will it sway voters in the 2022 congressional elections?
The federal government reported earlier this month that inflation has surged over the past 12 months as the U.S. economy recovers from the coronavirus pandemic. The consumer price index increased by 0.9% in October, the U.S. Bureau of Labor Statistics said, leaving prices 6.2% higher than a year earlier. It’s the largest 12-month increase since 1990.
The Strategic Petroleum Reserve is a stockpile to preserve access to oil in case of natural disasters, national security issues and other events. Maintained by the Energy Department, the reserves are stored in caverns created in salt domes along the Texas and Louisiana Gulf Coasts. There are roughly 605 million barrels of petroleum in the reserve.
What is the Strategic Petroleum Reserve?
The US Strategic Petroleum Reserve is a reservoir of more than 600 million barrels of oil stored in underground chambers in the Texas and Louisiana coasts. The reserve was established by Congress in 1975 after the 1973 oil crisis, when oil-exporting nations throttled their production and caused energy prices to soar.
In recent years, the US has tapped the reserve to raise revenue as shifts in global oil production made lawmakers less concerned about potential shortages.
‘No slam-dunk solution’: What can Joe Biden do to tame soaring inflation?