Following Thursday’s announcement of the Biden Administration considering a 180m barrel release of oil from its Strategic Petroleum Reserve (SPR) in an attempt to reduce fuel costs, President Biden made an announcement of beginning the release of 1m barrels per day for 6 months in May.
President Joe Biden ordered an unprecedented oil release from US reserves in an effort to cut fuel prices, which have been aggravated by Russia’s invasion of Ukraine. He also called upon oil corporations to increase supply to help with his plan to reel in oil prices.
In May 2022, he plans to release 1m barrels of crude oil per day for 6 months making it the largest release from the SPR since it was established in 1974.
Today, President Biden is announcing a two-part plan to lower gas prices for families by immediately increasing the supply of oil and working towards American energy independence that would reduce demand for oil and bolster our clean energy economy. pic.twitter.com/bXhPSVx0ti
— The White House (@WhiteHouse) March 31, 2022
The first part of the plan is to enhance the supply of oil immediately by doing anything they can to stimulate domestic output right now, and using the record SPR release, to aid the demand for higher supply in the months ahead, said the White House.
Domestic output is predicted to rise by one million barrels per day this year and approximately 700,000 barrels per day the next year.
“This is not the time to sit on record profits, it is time to step up for the good of your country,” Biden addressed oil executives as corporations continue with normal oil productions with disregard for rising oil prices.
The oil and gas sector presently owns more than 12 million acres of non-producing federal land, as well as 9,000 underused but already-approved production permits, according to the White House.
As a result, Biden is urging Congress to levy taxes on wells from leases that haven’t been used in years, as well as acres of public land “that they are hoarding without producing.”
President Biden said that the decision to release the oil was made in agreement with western partners, who have also joined the effort to put economic sanctions on Russia in the aftermath of its invasion of Ukraine. In consideration of OPEC+ not ramping up supply, the POTUS hopes for allies to join him with releasing their own reserves which Biden believes will help cut the cost if they released “30 to 50m barrels”.
The proceeds from the oil release will be used by the Department of Energy to refill the SPR in future years.
Oil prices dropped 2% on Friday to $102 per barrel as the POTUS announced the largest release of oil reserves to help cut fuel prices.
