Biden to release oil reserves to lower gas prices as midterms loom [Video]

WHAT YOU NEED TO KNOW:

• President Joe Biden announced Wednesday the release of 15 million barrels of oil from the country’s reserves to lower soaring gas prices.
• The federal government has already released around 165 million barrels since Russia’s invasion of Ukraine.
• The release aims to extend the current reserve delivery program through the end of the year.

President Joe Biden announced Wednesday that the federal government will put more oil on the market by releasing 15 million barrels from the country’s reserves to lower gas prices.

The supply will come from the country’s Strategic Petroleum Reserve (SPR), part of the Biden administration’s 180-barrel program in May to curb soaring prices. The release will extend the program through December of this year. 

“Gas prices hit almost every family in this country and they squeeze their family budgets. When the price of gas goes up, other expenses get cut,” Biden said. “That’s why I have been doing everything in my power to reduce gas prices since Putin’s invasion of Ukraine caused these prices to spike and rattle international oil markets.” 

The Biden administration had already released about 165 million barrels as part of the initiative. The additional 15 million barrels represent the culmination of the multi-month plan.

The president accused oil companies for pocketing larger profits instead of lowering prices for consumers.

“That’s great if you own a lot of stock in oil company or if you’re an executive at an oil company — puts a lot of money in your pocket,” Biden said. “That is how you get paid. But it’s not the case for the vast majority of Americans.” 

The SPR, which holds over 700 million barrels of crude, serves as an emergency oil stockpile for the coutry. Currently, it holds just more than 408 million barrels in the week ending October 7.

Biden said the U.S. will “replenish” the stockpile when crude prices fall to $70 per barrel. The U.S. tradedwas around $85 per barrel on Wednesday. 

The administration’s plan to buy oil when it’s cheaper “means oil companies can invest to ramp up production now with confidence they’ll be able to sell their oil to us at that price in the future,” Biden added.

“Refilling the reserve at $70 per barrel is a good price for companies, it’s a good price for taxpayers, and it’s critical to our national security.”

“My message to American energy companies is this: You should not be using your profits to buy back stock or for dividends,” the president said. “Not now, not while a war is raging.”

Source: Reuters