Biden authorises release of 1 million barrels of oil per day from reserves to counter rising gasoline prices

Washington, April 1, 2022

United States President Joe Biden on Thursday authorized the release of 1 million barrels per day of oil for the next six months from the country's Strategic Petroleum Reserve to help tide over the shortages caused by Russia's invasion of Ukraine and the consequent rising prices of gasoline for consumers in the US.

"This is a wartime bridge to increase oil supply until production ramps up later this year. And it is by far the largest release from our national reserve in our history," he told journalists at the White House.

He said the 180 million barrels of oil from the reserve would "provide a historic amount of supply for a historic amount of time — a six-month bridge to the fall".

"And we’ll use the revenue from selling the oil now to restock the Strategic Petroleum Reserve when prices are lower so we’ll be ready — we’ll be ready for future emergencies," he said.

Biden said he coordinated this release with allies and partners around the world. "Already, we have commitments from other countries to release tens of millions of additional barrels into the market.

"Together, our combined efforts will supply well over a million barrels a day — nations coming together to deny (Russian President Vladimir) Putin the ability to weaponize his energy resources against American families, and families and democracies around the world," he said.

Biden began his remarks by speaking about the US response to the Russian invasion of Ukraine.

"Today, I want to talk with you about the costs here at home of Putin’s decision to brutally and savagely invade a sovereign nation. The fact is, he’s causing thousands of deaths and untold destruction.

"Working with our NATO Allies and our European partners and beyond that, we — we’re responding. We’re aiding the Ukrainian people both economically and militarily while levying the most punishing economic sanctions against Russia ever used against another nation in place and increasing them.

"Thus far, these actions are crippling Russia’s economy, isolating Putin from the world, and helping Ukrainians fight for their country and ease their suffering.

"But as I’ve said from the start, Putin’s war is imposing a cost on America and our allies and democracies around the world," he said.

Coming to gasoline prices, Biden said he was laying out a two-part plan to ease the pain and help America achieve true and lasting energy independence.

He recalled that the US had already banned the import of Russian oil. "As Russian oil comes off the global market, supply of oil drops and prices are rising," he pointed out, adding that, for lower gas prices, there was need to have more oil supplies right now.

He said that many US oil companies are taking steps to increase production and investing in clean technoligies to reduce the country's dependence on oil in the future.

But there were other companies which are not increasing supply because the situation is bringing them higher profits.

"I say: Enough. Enough of lavishing excessive profits on investors and payouts and buybacks when the American people are watching, the world is watching. U.S. oil companies made nearly $80 billion in profit last year. And this year, those profits are expected to continue to soar. This is a time — not the time to sit on record profits.

"It’s time to step up for the good of your country, the good of the world; to invest in immediate production that we need to respond to Vladimir Putin; to provide some relief for your customers, not investors and executives," he said, adding that companies have an obligation that goes beyond just their shareholders: to their customers, their communities, and their country.

"No American company should take advantage of a pandemic or Vladimir Putin’s actions to enrich themselves at the expense of American families," he said.

He said that the US oil and gas industry was sitting on nearly 9,000 unused but approved permits for production on federal lands. There are more than 12 million unused acres they have a right to — to pump on.

Biden said that, as the first part of his plan, there would be a “use it or lose it” policy.

"Congress should make companies pay fees on wells on federal leases they haven’t used in years and acres of public land they’re hoarding without production. Companies that are already producing from these wells won’t be affected. But those sitting on unused leases and idle wells will either have to start producing or pay the price for their inaction," he said.

He said that, while this action would make a real difference over time, it would take companies months, not days, to increase production. That is why he had decided to release oil from the strategic reserve, he said.

"Ultimately, we and the whole world need to reduce our dependence on fossil fuels altogether. We need to choose long-term security over energy and climate vulnerability. We need to double down on our commitment to clean energy and tackling the climate crisis with our partners and allies around the world.

"And we can do that by passing my plan that is literally before the Senate right now — the United States Congress right now — it’s been there for well over a month — to speed the transition to a clean energy future that is made in America with American products and American values," he said.

"We need to embrace all the tools and technologies that can help us free us from our dependence on fossil fuels and move us toward more homegrown clean energy technologies made by American companies and American workers so we can bolster ... domestic supply chains here at home and export those technologies around the world to reduce greenhouse gases.

"That’s why, today, I am issuing a directive to strengthen our clean energy economy. I’m going to use the Defense Production Act to secure American supply chains for the critical materials that go into batteries for electric vehicles and the storage of renewable energy: lithium, graphite, nickel, and so much more.

"We need to end our long-term reliance on China and other countries for inputs that will power the future. And I’ll use every tool I have to make that happen.

"Yes, building a made-in-America clean energy future will help safeguard our national security. Yes, it will help us tackle climate change. Yes, it’s going to help us ensure that America creates millions of good-paying jobs for generations to come," he said.

Biden went on to talk about the advantages of using electric vehicles, among other things.

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