On Sunday, Senate Majority Chuck Schumer (D-NY) said that President Joe Biden should tap into US emergency oil reserves to lower rising gasoline prices.
The timing should take place soon as Americans begin their holiday season. Traditionally, many Americans take long drives or book travels to be with families and loved ones during the holidays.
Tapping Oil Reserves Can Provide Immediate Relief From High Gas Prices
Schumer appeared before a news conference to talk about concerns over high gas prices. He acknowledged the need to address rising gas prices in light of OPEC’s refusal to increase the supply available.
“We're here today because we need immediate relief at the gas pump and the place to look is the Strategic Petroleum Reserve,” he said.
Car sales went up as US production increased its pace. This led to higher oil prices at more than $80 per barrel. Meanwhile, the Organization of Petroleum Exporting Countries (OPEC) and its allies rejected pleas to increase oil production.
Granholm Says President Can Act, But No Word Yet If He Will
Meanwhile, Energy Secretary Jennifer Granholm said that the President can authorize the release of oil reserves. Biden can call up the US Strategic Petroleum Reserve located in Texas and Louisiana.
Some analysts believe that getting oil reserves from the SPR can only help short-term. Getting oil reserves to lower gas prices will not increase US oil production capacity.
However, Schumer thinks now is the time. As the US economy begins its recovery process after the pandemic, demand can’t keep up with supply.
Given the present supply chain disruptions, the supply-demand problems keep getting worse. “No industry is spared. But fuel gasoline is the worst of all. Let's get the price of gas down right now. And this will do it,” Schumer said.
Democrats Pushing For Biden To Approve Use of Oil Reserves
Last week, 11 Senate Democrats sent a letter urging Biden to tap the SPR. They also asked the President to ban crude oil exports to bring down fuel prices.
The group cited OPEC’s recent decision to not increase production. OPEC won’t increase production until next year. The oil group insists on a gradual increase. The group prefers to wait for a stable situation before committing to return to normal levels.
“Continued U.S. exports and overseas supply collusion could be devastating to many in our states, contributing to higher bills for American families and businesses,” the senators wrote last November 8. They hailed from Pennsylvania and the New England states.
Will Biden Open The SPR and Use Oil Reserves
Asked if Biden will open the SPR, National Economic Council director Brian Deese said that all options remain on the table. “We are very committed to do everything that we can to make sure that American consumers don't bear the brunt of high gas prices and value tile energy prices,” Deese said.
However, Biden needs to do something. The continued rise of gas prices is beginning to take its toll on his popularity. His approval rating sank to a new low this month.
Half of all Americans, including independents, point to him for the mounting inflation rates. Will Sungchil Yun, senior commodities analyst at VI Investment Corp said Biden has some cards left to play.
“There seems to be a limited number of cards the U.S. can use to fight inflation, which are an SPR release, rate hike, and easing restrictions on Iranian oil exports. The quickest solution that has a longer-lasting impact would be Iran. That would push prices down with added supply,” he said.
Watch the Moments News reporting that Senator Chuck Schumer urges Biden to tap petroleum reserve to ease fuel prices:
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