The White House said on Tuesday that it has many options to counteract OPEC+’s looming production cuts, including the release of even more crude oil from the nation’s Strategic Petroleum Reserves.
According to the Energy Department’s deputy secretary David Turk, “We still have some additional ability to use the Strategic Petroleum Reserve over the coming weeks and months as needed.”
The comments, made at an Axios-hosted event on energy reliability, come as the Biden Administration is winding down its release of 180 million barrels from the SPR. There is roughly 10% of the latest 180 million barrel release still on track to be sold out of the SPR.
But even more barrels from U.S. Strategic Petroleum Reserves has been released so far last year and this year. Since 2021, the nation’s SPR has diminished by about 35%, with 2021 starting with 638 million barrels in inventory. By the end of the year, that figure had dropped to 594 million barrels. Today, there are 416 million barrels—and even more are set to be released. Now it looks like even more oil could soon make its way out of the SPR and into commercial inventories.
The Biden Administration initially made the move to release a million barrels of crude oil per day from the nation’s stockpiles in March to tide the United States over to a time when U.S. crude oil producers could fill the gap between supply and demand, ultimately in hopes of bringing down gasoline prices that were saddling drivers with steep transportation costs.
Gasoline prices did ease off their highs, although they remained significantly higher than year-ago pricing. With OPEC+ now moving to cut production quotas starting next month, the pressure is once again on the White House to find a solution to the corresponding price hike, which also will send more revenues into Russia that will help fund its war in Ukraine.
By Julianne Geiger for Oilprice.com
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Julianne Geiger is a veteran editor, writer and researcher for Oilprice.com, and a member of the Creative Professionals Networking Group.