Key Takeaways:
- US President Joe Biden plans to release 15 million barrels from the country's strategic reserves
- This is in continuation of his earlier decision in March to release 180 barrels in 6 months
- Opponents have slammed the move as a political stunt ahead of the mid-term elections in November
YEREVAN (CoinChapter.com) — United States President Joe Biden will release 15 million barrels of oil from the U.S. strategic reserve. The move comes amid the increasing gasoline prices in the country ahead of the upcoming mid-term election in November.
As the winter approaches, President Biden may have to free up additional oil supplies, considering the massive drop in global supply.
As CoinChapter earlier reported, Saudi Arabia -led Organization of the Petroleum Exporting Countries (OPEC+), announced they would reduce the global oil output. This, coupled with the ongoing Russian invasion of Ukraine, has created a global oil scarcity.
President Biden Comes Under Fire From Political Opponents
His decision has already attracted attacks from political opponents, who see this move as politically motivated. Many of his political opponents have taken to Twitter to express their disagreements with the decision.
US Senator from Tennessee Marsha Blackburn termed it “a political stunt”, calling on him to open more pipelines.
Other US politicians have also expressed similar sentiments on Twitter.
“Joe Biden is releasing another 15 million barrels of our strategic petroleum reserves. These reserves are meant for crises like national security or hurricanes – not political gimmicks 3 weeks before the midterms. Instead, it’s time to Make America energy indeoendent again,”
Republican Congressman Richard Hudson said.
The upcoming announcement comes as no surprise. At the end of March this year, President Bident announced his administration will release 180 million barrels of oil from the Strategic Petroleum Reserve.
This plan, aimed at reducing the burden on ordinary citizens at the gas pipe, is the largest release in US history. This translates to one million barrels a day, or a third of the reserve’s supply.
The latest release will send the oil reserves to the lowest levels since 1984. The US oil reserves have a capacity of around 714 million barrels. However, owing to Biden’s policies, it now holds a little over 400 million barrels, according to the strategic oil reserve chart.
US Strategic Oil Reserve Chart
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Joe Biden’s 15 Million Barrels Are Insignificant
Joe Biden’s plan to release 15 million barrels from the strategic reserves is unlikely to make any drastic impact. As experts point out, the United States uses over 20 million barrels a day. Hence, the release of 15 million is not enough even for a single day’s supply.
Moreover, the latest decision of OPEC+ could decrease availability by 2 million barrels a day. The negative impact of the global oil reduction on prices will be too large.
This has increased the tension between the US and Saudi Arabia, which leads the OPEC+. Washington accuses Riyadh of siding with Vladimir Putin to help him evade sanctions.
According to AAA, the national average for gas prices in the US is $3.85. This is a significant increase from last month’s average of $3.67.
As per a recent report by Bloomberg, the US Government will begin refilling those reserves when the West Texas Intermediate crude prices are at or below $67 to $72 per barrel.
The yet-to-be-released 15 million barrels will hit the markets in December. It remains to be seen if the decision will bring political dividends for the Democratic Party next month.
