Biden may tap US strategic oil reserves – FT

The move is being touted as a way of reducing prices at the pump ahead of the presidential election, according to a report

US President Joe Biden may order the release of more crude from the Strategic Petroleum Reserve (SPR) in an effort to tame rising gasoline prices and inflation ahead of the election in November, the Financial Times reported on Monday.

The SPR is an emergency stockpile of petroleum maintained by the US Department of Energy, which was established after an OPEC oil embargo in 1973 and 1974. It serves as a buffer against spikes in oil prices in times of supply disruptions.

In an interview with the FT, Biden’s closest adviser on energy, Amos Hochstein, pointed out that prices at the pump were “still too high for many Americans,” and said he would like to see them “cut down a little bit further.” 

Biden has tapped the SPR more than any of his predecessors, announcing releases from the reserve in late 2021 and again in 2022, following Russia’s oil production cut due to Western sanctions.

Any decision in the coming months to release more barrels from the SPR would anger Republicans, who have accused Biden of “political abuse and misuse” of the stockpile, the FT wrote.

In a letter sent last month to Energy Secretary Jennifer Granholm, senior Republicans reportedly called on the administration to “ensure that the SPR is not abused for political purposes in this election year.” It described Biden’s decision to tap the reserves in 2022 as “a transparent attempt to influence the midterm elections.”

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The Biden administration has promised measures including curbs on healthcare costs and banking fees in a bid to control inflation, which has fallen by about 60% since hitting multi-decade highs in 2022.

“Any president facing a tough re-election, especially in a fragile economy, is going to be anxious about the risk of a gasoline price spike,” said Bob McNally, a former energy adviser to George W. Bush and head of consultancy with Rapidan Energy.

According to the AAA motoring group, cited by FT, petrol prices in the US averaged $3.45 a gallon on Sunday, down slightly from a year ago but still more than 50% higher than when Trump left the White House in 2021.

Trump has used petrol prices as an attack line against Biden in the current presidential campaign, telling supporters at a rally in Las Vegas last weekend: “We’re going to drill, baby, drill. We’re going to bring down your energy costs.”