Is Biden right to release emergency oil reserves?
- On November 23, 2021, President Biden announced the release 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.” The decision will be “taken in parallel” with other nations: China, India, Japan, the Republic of Korea, and the United Kingdom.
- According to the US Energy Information Administration, by November 15, 2021, the US gasoline retail price decreased to more than one cent to $3.40 a gallon, which is $1.29 higher than the previous year.
- In 2020, gas prices were set at $2.17 per gallon, which was 17% down from $2.60 in 2019.
- On November 19, 2021, President Biden’s nearly $2 trillion Build Back Better Framework was passed 220-213 by the House. On November 6, 2021, the House passed the $1 trillion bipartisan infrastructure bill in a 228-206 vote.
The Biden administration has announced it will release 50 million barrels of oil from America’s Strategic Petroleum Reserve. It is intended to reduce oil prices, and the price drivers pay at the pump. However, the emergency oil reserves are for just that—an emergency. It is not meant to be used as a ploy to bring down the prices at the pump, which have increased, in part, due to his inflationary policies, not to mention his antagonistic policies toward fossil fuels. If Biden would stop canceling American oil pipeline plans (such as Keystone XL and Michigan), a way in which to make this nation energy independent, oil and gas prices would likely not be as high as they are now.
This move comes after Biden begged, unsuccessfully, to get OPEC to increase its oil production. Biden has made it clear he wants to decrease domestic oil production. Yet, at the same time, he wants foreign oil producers to pump more oil. This, like much of this administration’s policies, makes no sense.
As recently as 2018, the US became a net oil exporter for the first time in 75 years. Just as important, the average price of a gallon of gas in the United States in 2018 was $2.86. Currently, average gas prices are at about $3.40 a gallon. Biden says releasing some of the emergency oil reserves to address supply, yet 50 million barrels are a little less than three days’ worth of American oil consumption.
This is not a solution to increasing gas prices. It is a short-term fix that comes at the cost of our oil reserves. While there may be a slight dip in gas prices, the practical effect is likely to be limited.
The sharp rise in national gas prices is reverberating throughout the nation, and the Biden administration is scrambling to soften the blow for American consumers. Fuel prices are up over $1.30 per gallon from just last year, leaving citizens yearning for financial reprieve. Despite repeated requests from President Biden, Russia and OPEC have refused to help by increasing daily oil production. “Biden’s commitment to bringing down costs for the American people are reflected in his decision to release 50 million barrels of crude from the Strategic Petroleum Reserve”, according to a statement from the White House.
President Biden also directed the Federal Trade Commission to investigate the possibility of illegal activities in the gas and oil markets. He wants to ensure that declining oil prices directly translate into lower prices for the American people at the pump. Biden’s strategic reserve option, made in coordination with five other oil-consuming nations, will help regain control of rising costs at the pump and help moderate the price of oil across the globe.
The administration remains committed to fighting climate change with ambitious goals for clean energy and a net-zero emissions economy. But at the same time, they understand Americans’ need to access gas and oil to travel and attain basic goods and services. The transition to clean alternative energy sources will take time and dedication as we overcome immediate obstacles to keep our country moving forward. Temporarily tapping into the Strategic Petroleum Reserve is the best way to do just that while controlling prices at the pump.