Biden to announce the release of 50 million barrels of oil

(CNN) — US President Joe Biden will announce the release of 50 million barrels of oil from the Strategic Petroleum Reserve on Tuesday as his administration seeks to combat rising oil and gasoline prices ahead of the busy travel season. end of the year.

“Today, the President will announce that the Department of Energy will make available emissions of 50 million barrels of oil from the Strategic Petroleum Reserve to lower prices for Americans and address the mismatch between demand coming out of the pandemic and supply. “the White House said in a statement.

That will include 32 million barrels of oil as “an exchange over the next few months, releasing oil that will eventually return to the Strategic Petroleum Reserve in the next few years,” as well as 18 million barrels that “will be an acceleration into the next several months. of an oil sale that Congress had previously authorized.

The decision comes amid recognition that inflation and high gasoline prices are directly related to Biden’s political fortunes.

President Joe Biden speaks during an event in the South Court Auditorium in the White House complex in Washington, Monday, Nov. 22, 2021.

“Today’s announcement reflects the president’s commitment to do everything in his power to reduce costs to the American people and continue our strong economic recovery,” the White House said.

As CNN’s Jeff Zeleny and Kaitlan Collins reported Monday, the move comes as a coordinated joint effort with China, India, Japan, the Republic of Korea and the United Kingdom, which officials believe could have a greater impact on prices. of gasoline.

The release of oil barrels would be in December

The release of the Strategic Petroleum Reserve will release barrels of oil to the market “in mid to late December, depending on market absorption,” said a senior government official.

In a briefing with reporters Tuesday morning, senior officials said the administration is focused on making sure its efforts lead to relief for Americans at gas stations.

US oil prices rise to 7-year highs 1:07

“We see our actions here as two sides. First, by making sure that the price of oil is going down, reflecting the fact that we have to have a supply that matches demand, but also making sure that those savings are passed on to consumers, “said a senior Biden administration official. .

“The president directed the Federal Trade Commission to investigate and verify if there are anti-consumer practices in the oil and gasoline industry that reflect a consolidation there, but you know, we expect the industry to pass these savings on to consumers as much as possible. as fast as possible “.

When asked by CNN’s Matt Egan if the administration sees this as a short-term or long-term solution, and if they expect a drop in oil prices, senior administration officials pointed to other actions taken by the Administration.

“We believe this is an immediate challenge that we face as we emerge from the global pandemic and supply has not kept up. We believe this fits exactly that,” said a senior official.

On pricing, this person pointed to other efforts by the administration and that today’s announcement is a “culmination” of their efforts.

“Of course we think that it is not only important that oil prices fall, but that prices fall at the pump, so we are also as focused on making sure that prices pass quickly to consumers as they should,” said this official.

CNN reported Monday that Biden had been privately informed that tapping into the reserve wouldn’t do much to alleviate current problems, although some lawmakers have argued it could provide such relief.

Pressed by a reporter on what the expectations should be for the public, a senior official argued that they believe it should be “soon” and noted that the administration is conducting other efforts, such as the FTC investigation.

“In terms of when consumers will see relief, we think it should be, and should be, soon,” he said.

Another official noted that the market is “dynamic” and admitted that the administration cannot control everything.

“What we have with these 50 million barrels with the exchange in the sale are flexible tools during the next months, a period of time for us to make the necessary adjustments to face the dynamic market in which not everything is under our control” said this official.

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Biden to announce the release of 50 million barrels of oil