Biden to announce release of more oil from Strategic Petroleum Reserve just weeks before midterms
White House said it will release 15 million barrels from SPR, refill when oil prices dip to $67-72
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Senior administration officials said Tuesday that President Biden is releasing 15 million more barrels from the Strategic Petroleum Reserve (SPR), in a move aimed at cutting persistently high energy and gas prices.
The senior administration officials said Biden will make the announcement in remarks Wednesday, less than three weeks before the midterm elections. Biden will also detail a plan to begin to refill the depleted oil cache when prices dip to $67-$72 per barrel, according to the officials.
Biden earlier this year announced that he would release 180 million barrels from the SPR, and the White House said the latest 15 million barrels would complete that commitment.
Biden's use of the reserve to address high prices has drawn criticism from outside observers who say withdrawals should be reserved for emergencies like wars or natural disasters. But the White House says the releases are addressing issues with international stability, and that the SPR remains in strong shape.
President Biden will announce more SPR drawdowns Wednesday. (AP Photo/Evan Vucci, Pool, File / AP Newsroom)
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"Global crude oil supplies remain a challenge due in large part of the course of the ongoing stability caused by Russia's actions in Ukraine," a senior administration official said.
"The SPR still remains the largest strategic reserve with more than… 400 million barrels remaining. That is still a large amount of barrels," the senior administration official added. "You'll certainly see in the president's remarks… that we remain, DOE remains, very able, very vigilant, If we need to deal with additional challenges with supply, with affordability, then we'll have additional opportunity with the SPR."
The senior administration officials signaled that Biden may not be done tapping the reserve, saying that as the U.S. heads into winter it might consider releasing yet more oil.
"We're going to use all the tools we have in the tool belt, and the SPR remains a very, very important tool. Not the only tool we have, but it's an important tool," a senior administration official said. "If we need to authorize additional sales, significant additional sales… we'll be prepared to do so."
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High gas prices at a station on October 03, 2022 in Mill Valley, California. President Biden is announcing more action to cut gas prices Wednesday. | Getty Images
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The senior administration officials said Biden will aim to refill the reserve – which is down over a third since the president entered office – when the price of a barrel is down to $67 to $72 per barrel. The official also said the White House is working on a rule to allow "fixed price contracts" with suppliers to ensure the actual cost of the oil to taxpayers is the same as the price when the commitment to buy the barrels is made.
Committing to refilling the SPR at a lower price will also give domestic energy producers confidence to produce more, the senior administration official said.
"The SPR will be part of helping to…moderate and stabilize price flows not only when prices are going high but when prices are going low," the official said.
The announcement comes after OPEC+ announced that it will cut oil production by 1 million barrels per day, in a move Biden and the White House harshly criticized.