White House taps emergency oil reserves to lower gas prices

President Biden is under mounting pressure to curb rising gas prices, which for Americans have become a sour cherry on top of a record-inflation sundae. The White House announced today that it will tap into the U.S. Strategic Petroleum Reserve and release 50 million barrels (about 2 billion gallons) in hopes of bringing prices down as the busy holiday travel season approaches. That amount will mark one of America’s largest emergency oil releases ever—more than during Operation Desert Storm in 1991, Hurricane Katrina in 2005, and the Libyan uprising in 2011. The U.S. decision was made in concert with Britain, China, India, Japan and South Korea, which will tap into their own oil reserves.

But the government can’t simply drop 50 million barrels into the market overnight without causing new problems. Of these barrels, 32 million will be released through what’s called an “exchange” over the next few months, meaning the U.S. will essentially loan them to gas companies, which must replace them. Another 18 million are part of “an acceleration” of a sale to gas companies that Congress already approved and will take place in the next months as well. But a White House official tells media it will be “mid to late December” before the first barrels hit the market. Meanwhile, some analysts warn the effects may only lower prices slightly and, even then, just temporarily.

The White House is countering that it’s prepared to take additional steps if needed. The statement it released this morning reads: “American consumers are feeling the impact of elevated gas prices at the pump and in their home heating bills, and American businesses are, too, because oil supply has not kept up with demand as the global economy emerges from the pandemic. That’s why President Biden is using every tool available to him to work to lower prices and address the lack of supply.”

Gas prices are breaking records nationwide. Last week, California’s average price reached $4.71 per gallon, an all-time high. Drivers in Texas are looking at prices that reflect a seven-year high for Thanksgiving week. And New Yorkers are paying $1.22 more per gallon than they were a year ago. Americans say it’s forcing them to cancel vacation plans, dine in instead of out, and slash the rest of their budgets.