The Biden administration has announced another major release from the Strategic Petroleum Reserve (SPR)—with curious timing.
- President Joe Biden announced on Wednesday that the SPR will release an additional 15 million barrels of oil, to be delivered in December.
- “President Biden is directing his administration to take additional action to strengthen energy security, address the supply crunch, and lower costs,” says the press release.
- The announcement comes following Republican accusations that the administration is trying to artificially lower gas prices prior to the U.S. midterm election on November 8, in less than three weeks.
- “The move came two weeks after the Saudi Arabia-led OPEC+ organization rankled Biden by siding with Russia and agreeing to a production cut, raising fears of a new spike in U.S. pump prices,” says Reuters.
- The national average gas price is $3.85 per gallon, down from $3.92 last week and lower than the historic peak on June 14 at $5.02. Prices are still $0.17 higher than this time last year.
Why it’s important
Gas prices are a major factor in election victories and the historically high gas prices of the past eight months are a liability for the Biden administration.
As we previously reported, the administration reportedly asked for a month delay to an announced two million barrel cut from OPEC, which could delay rising gas prices until after the election. Biden promised retaliation against OPEC. Biden previously had ten million barrels of gas released from the SPR, which may affect November’s oil prices.
Biden addressed Republican claims that the oil release was politically motivated in a Wednesday speech, saying “It’s not politically motivated at all.”
The administration is blaming high gas prices on oil companies’ profit-seeking.
“The President is calling on companies to pass through lower energy costs to consumers right away. The profit that energy refining companies are now capturing on every gallon of gasoline is about double what it typically is at this time of year… Keeping prices high even as input costs fall is unacceptable, and the President will call on companies to pass their savings through to consumers–now,” says the press release.
“The administration is committed to replenishing the SPR, which is an important national security asset, so it can continue to serve its purpose well into the future. And, it is committed to doing so in a way that protects taxpayer interests, avoids putting upward pressure on prices in the near term, and encourages more production right now by providing certainty about repurchases in the future,” says the press release.