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The Biden Administration is still not decided whether the U.S. should act now to try to reduce the highest gasoline prices in America in seven years or to wait for the market to run its course, Bloomberg reported on Friday, quoting sources with knowledge of the ongoing debates.
President Joe Biden is considering a release from the SPR as a possible move to reduce gasoline prices after OPEC+ ignored calls for putting extra barrels on the market, Secretary Granholm told Bloomberg last week.
“Hopefully there will be an announcement or so this week,” Granholm told MSNBC in an interview on Monday.
“He’s certainly looking at what options he has in the limited range of tools a president might have to address the cost of gasoline at the pump, because it is a global market,” the energy secretary added.
As of early on Friday, the Biden team was still debating what options to choose and whether to choose those options now, according to Bloomberg’s sources.
Some officials at the U.S. Department of Energy are reportedly against an SPR release, while some White House aides part of the talks favor a release and even the “nuclear option” of a crude oil export ban, the sources told Bloomberg.
Eleven Democratic Senators urged the Administration this week to consider all options—including an SPR release and a crude export ban—to try to lower the high gasoline prices.
If President Biden approves an intervention now, it could likely consist of several tools, according to Bloomberg’s sources.
The three most debated options include an SPR release which analysts see as likely but not very effective. Another would be relaxing the biofuel standards so that refiners process more crude into gasoline. The third option is a ban on U.S. crude oil exports, which analysts see as an unlikely move that would upend global oil flows, sink WTI prices, and at the same time raise the price of foreign oil which refiners import anyway, and diminish the U.S. role on the global energy market.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.