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Biden announces release of oil reserves, but says gas prices will not drop overnight

<i>Susan Walsh/AP</i><br/>President Joe Biden on Tuesday will announce the Department of Energy will release 50 million barrels of oil from the Strategic Petroleum Reserve as part of an effort to lower high gas prices and address the lack of oil supply around the world. Biden is shown here at the Port of Baltimore on Wednesday
Susan Walsh/AP
President Joe Biden on Tuesday will announce the Department of Energy will release 50 million barrels of oil from the Strategic Petroleum Reserve as part of an effort to lower high gas prices and address the lack of oil supply around the world. Biden is shown here at the Port of Baltimore on Wednesday

By Kate Sullivan, Betsy Klein and Devan Cole, CNN

President Joe Biden on Tuesday announced the release of emergency oil reserves to combat high energy prices ahead of the busy holiday travel season, but it will be weeks before the barrels hit the market.

The Department of Energy will release 50 million barrels of oil from the Strategic Petroleum Reserve, according to the White House — the largest release from the reserve in US history, Biden said.

Biden on Tuesday noted that the administration’s actions “will not solve the problem of high gas prices overnight.”

“It will take time, but before long, you should see the price of gas drop where you fill up your tank,” he said during his remarks. “And in the longer term, we will reduce our reliance on oil as we shift to clean energy.”

The release is aimed at addressing the lack of oil supply around the world, but its actual effect may be limited. In 2019, US petroleum use averaged approximately 20.5 million barrels of oil per day and in 2020 the US used on average about 18.1 million barrels per day, according to the Department of Energy’s Energy Information Administration. The EIA reports petroleum usage was lower in 2020 due to the Covid-19 pandemic.

The barrels of oil involved in Tuesday’s announcement will not hit the market until “mid to late December, depending on market take up,” according to a senior administration official.

“We’re taking action. The big part of the reason Americans are facing high gas prices is because oil producing countries and large companies have not ramped up the supply of oil quickly enough to meet the demand. And the smaller supply means higher prices globally, globally, for oil,” Biden said during remarks at the White House.

This release will be in coordination with several other countries, including China, India, Japan, the Republic of Korea and the United Kingdom. Officials believe the coordinated effort could potentially have more of an effect on lowering gas prices.

As of Friday, there were 604.5 million barrels of oil in the Strategic Petroleum Reserve, according to the Department of Energy.

The move comes as the White House faces mounting pressure to lower skyrocketing prices at the pump that are contributing to the biggest inflation spike in decades, causing frustration and anger among Americans.

The President on Tuesday called the issue a “problem” both in the US and around the world, and stressed that while spikes in prices are usually temporary, “it doesn’t mean we should just stand by idly and wait for prices to drop on their own.”

Thirty-two million barrels will be in exchange “over the next several months,” the White House said, and those barrels will eventually return to the Strategic Petroleum Reserve “in the years ahead.” Eighteen million barrels “will be an acceleration into the next several months of a sale of oil that Congress had previously authorized.”

“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,” the White House said in a news release. “That’s why President Biden is using every tool available to him to work to lower prices and address the lack of supply.”

CNN previously reported Biden hoped to announce his decision to release the oil reserves during a Tuesday speech at the White House, but that the timing of such a move was still contingent on other nations finalizing their agreements.

The President made his remarks just hours before he is set to leave for a Thanksgiving break on Nantucket off the coast of Massachusetts.

Biden had been privately advised in recent weeks that tapping into the reserve wouldn’t do much to alleviate the current problems, but some Democratic lawmakers argued it could provide temporary relief at the pump. Senate Majority Leader Chuck Schumer was among the Democrats leading the charge.

Despite being told the impact may be negligible, the option to release oil reserves remained on the table, given Biden had few others, and officials believed coordinating with other countries could potentially have more of an effect. One option was increasing domestic oil production, but the White House has been wary of the optics of the President and his aides pushing for more drilling at home on the heels of the major UN climate summit COP26, where Biden promised that the US would “lead by example” on clean energy initiatives.

The national gas price average as of Tuesday is $3.403, according to AAA, which is significantly higher than the average at the same time last year when many people were not driving or traveling as much due to the Covid-19 pandemic. It is unclear how much the White House effort would immediately affect prices.

The move may instead largely act as a signal to OPEC nations and Russia that the US is serious about taking action to lower prices after those nations were reluctant to ramp up oil production to reduce prices.

Biden officials have warned the Saudis for weeks that the US would find alternative solutions if the price of crude oil topped $85 a barrel, officials said, which it did late last month. But Saudi Arabia has stood firm in refusing to increase output and has priced in — wrongly, in the view of US officials — the possibility that the US reaches a nuclear deal with Iran, two US officials said. The Saudis’ concern is that sanctions on Iran would then be rolled back, allowing the country to ramp up its oil production and compete with OPEC+.

Given that reluctance, the Biden administration viewed coordinating with the other nations as an attempt to undermine the cartel’s control of the market.

“The thinking has been, we can do this alone, or we can do it internationally — and the latter would be much more effective, especially when it comes to sending a message to the Saudis,” said one senior official involved in the discussions.

Biden has taken other actions as well. Last week, the President asked the Federal Trade Commission to “immediately” investigate whether illegal activity by oil and gas companies is pushing up gas prices. That move isn’t likely to have an immediate effect on gas prices for consumers, but is another example that Biden is seeking to show he is working to bring prices down. The FTC’s findings could also help in the long run if they find wrongdoing. The oil industry’s top advocacy group slammed that move as a “distraction.”

This story has been updated with additional information.

™ & © 2021 Cable News Network, Inc., a WarnerMedia Company. All rights reserved.

CNN’s Sam Fossum, Jeff Zeleny, Kaitlan Collins, Natasha Bertrand and Matt Egan contributed to this report.

CNN Newsource



        1. Simple. Trump is a threat to the Deep State and the leftist propaganda. Obama and Biden are owned by the Deep State and Leftist Media and have complete weapons zed the Justice System. With that factual scenario, who do you think will be falsely indicted and who will be allowed to get away with corruption? Biden, Obama. Killary, Comey. All guilty of corruption.

        1. We aren’t exporting anything. China owns us. Just like, thanks to Biden, China now owns the largest cobalt and copper field in the world. So they will control the prices of your stupid little tinker toy cars for the rest of their short lives. EVs are not sustainable.

      1. So says the nitwit Char Lie Dumbo. You blamed Trump for high gas prices for 4 years when they were actually low compared to today with senile Joe. Hypocrisy much. Moron!

        1. Trump, like every other president, had no control over gas prices. Oil companies are publicly traded corporations and not government agencies like in Venezuela.

        1. Hey nitwit the faulty software issue was for the self driving mode that doesn’t work not the batteries. You can’t program a 1000 lb battery with softw3are. You’re an idiot.

        1. EV charge at your section 8 apartments? I doubt that. You’re the one that claimed you used Rudy’s EV charging station to charge that Tesla you don’t own. LIAR!

          1. I haven’t had a chance to charge my Tesla. Don’t get it til Friday. It will be fully charged when I pick it up.

      1. And then when changed his identi.ty to Charlie, he once stated he wished he could afford a Tesla. He doesn’t know where his lies end and the truth begins.

          1. It’s time for a crisis intervention consisting of the EPPD and reps from one of the local nut houses. His insanity is getting worse and he is a threat to others.

      1. It started. The price of oil going up due to senile Joe. Over $82 per barrel now. “Backfire: Oil Prices Soar as Market Rejects Biden Administration’s Strategic Reserve Ploy.” November 23, 2021.

      1. He doesn’t care. When uniformed leftist morons like Charlie/Mark don’t have a factual response they ALWAYS yell “Qanon”, “White Supremacist”, “Racist”. It’s their only defense. They’re weak and hateful. So hateful that they have unfortunately completely rendered the term “White Supremacist” irrelevant. It’s become just another leftist derogatory term to describe white people who disagree with the leftist tyrannical agenda. It no longer means anything. That’s unfortunate and it’s the leftists fault.

      1. Biden didn’t kill 13 soldiers either you nitwit. Isis did after Trump surrendered to the taliban prematurely and failed to process exit visas for our allies.

        1. Biden didn’t personally kill them but he is responsible. Trump didn’t surrender. He crafted an agreement to safely get our soldiers home that Biden ignored. Facts matter.

        2. Stop spreading fake news nitywit. But Trump didn’t surrender to the Taliban senile Joe did. Trump wasn’t President so the buck stops with your senile Joe. Trump defeated ISIS in Iraq ans Syria. Biden brought them back in that Afghanistan debacle. Obama failed to process visas for the interpreters. Senile Joe’s actions reflect in his 36% approval polls.

          1. Charlie/Mark doesn’t like facts. He has a very difficult time comprehending simple topics.

          2. He is a good example why liberalism is truly a mental disease. I can’t wait to see his head explode in 2022 when it’s 1994 all over again and we impeach Biden if he is still around.

  1. It started. The price of oil going up due to senile Joe. “Backfire: Oil Prices Soar as Market Rejects Biden Administration’s Strategic Reserve Ploy.” November 23, 2021.

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