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Entries in Strategic Petroleum Reserve (8)

Monday
Feb272012

Double-Digit Jump in Gas Prices to Come?

Jupiterimages/Thinkstock(WASHINGTON) -- The pain at the pump for American drivers continues.

The Department of Energy is likely to announce on Monday that over the past week gas prices have climbed by about 12 cents a gallon.  This latest increase would push the nationwide average closer towards $4 a gallon and comes well ahead of the peak driving season -- beginning in mid-May -- when prices are expected to go even higher.

This month alone, the cost of crude oil has jumped from $96 to $109 a barrel.

President Obama has been facing pressure from some Democrats to consider releases from the Strategic Petroleum Reserve.  However, energy analysts say that while this move might bring down gas prices for several weeks, it will have little impact on what happens during the summer and fall.

Copyright 2012 ABC News Radio

Friday
Jun242011

Tapping Into Oil Reserves May Lower Gas Prices

Jupiterimages/Thinkstock(NEW YORK) -- Following the Obama administration's announcement Thursday that it will be releasing 30 million barrels of oil from the Strategic Petroleum Reserve, oil prices tumbled by almost $4 a barrel.

But how exactly will this decision impact consumers?

Drivers have been battling high gas prices in recent months due to unrest in the Middle East and North Africa.  But analysts say tapping into the emergency oil reserves may lower prices at the pump.

Joel Naroff, an economist, says consumers could see gas prices go down to close to $3 a gallon.  And if so, that could mean some relief not only for Americans, but also for the country's economy.

"The decline in oil and the resultant decline in gasoline prices could help consumers," Naroff says.  "It's going to put more money in their pockets.  They're going to spend a little bit more."

Still, it may take a while for consumer psychology to improve.  The economy is fragile and the jobs and housing markets remain weak.

Copyright 2011 ABC News Radio

Thursday
Jun232011

House Dems Applaud Obama for Tapping Strategic Petroleum Reserve

Comstock/Thinkstock(WASHINGTON) -- As the White House announced Thursday that it will release 30 million barrels of oil from the nation’s Strategic Petroleum Reserve, House Democrats applauded the president’s decision as one that will bring down the price of gasoline, while the nation’s top Republican said the move “threatens our ability to respond to a genuine national security crisis” and puts a new burden on the American taxpayer to refill the reserve.

“I am pleased that the Obama administration has answered our call today by making an historic announcement,” Rep. Edward Markey, D-Mass., said. “The Strategic Petroleum Reserve is the one tool that we have that can actually provide relief to consumers at the pump this summer driving season, the Strategic Petroleum Reserve is the one weapon we have against OPEC, and it has a proven record of historically driving down prices.”

House Speaker John Boehner says that by tapping the SPR, “the president is using a national security instrument to address his domestic political problems.”

But the president was praised by House Minority Leader Nancy Pelosi at her news conference Thursday morning.

“I must congratulate the president for putting -- releasing 30 billion [sic] -- 30 billion [sic] barrels, which is part of the 60 billion [sic] barrel release of oil which, I believe, will immediately bring down the price at the pump, which is of concern to America's working families,” Pelosi, D-Calif., said.

Markey, who is the top Democrat on the House Natural Resources committee, pointed to previous instances when the SPR was tapped and the price of oil fell, and attributed the lower trade of oil futures Thursday to the president’s announcement.

 “The impact on oil prices from today's announcement is already being felt. The New York Mercantile Exchange oil futures are currently trading down on oil by five percent, within several hours of this announcement. So obviously the SPRO does work,” Markey said. “SPR stands for Strategic Petroleum Reserve, but it also stands for "sudden price reduction" whenever it is used, because it drives speculators out of the marketplace for fear that they are going to lose money as they bet on inaction by the United States government. Now they know that things aren't going to get worse without a fight from the Obama administration.

“Because of the reduction in the amount of oil coming in from Libya, because of the amount of oil that's now been taken off the market in Yemen, this is the right time to strike, to make a statement that we are not going to allow the markets to be disrupted -- and not to say that that's a signal to Iran, to Venezuela and others that we are going to fight back, that they will not be able to exploit this opportunity to hold prices high,” he added.

Copyright 2011 ABC News Radio

Thursday
Jun232011

House Natural Resources Chairman: Obama’s Move on Strategic Reserves May Backfire

US House of Representatives(WASHINGTON) -- Republicans are reacting skeptically to President Obama’s surprise decision to release oil from the Strategic Petroleum Reserve, arguing that it won’t have a major impact on gas prices -- and could be a move that the president regrets if there’s a significant supply disruption.

“I don’t think it's a very good move,” House Natural Resources Chairman Doc Hastings, R-Wash., told ABC News on Top Line Thursday. “It only supplies about a day and a half of the nation's supply of oil. But what it misses is a critical part: It doesn't create any jobs.

“Energy jobs are good-paying jobs. That's where we should be focusing. So all he's doing is releasing what should be there strategically, but it doesn’t do anything regarding jobs. But it does -- which I think is important -- acknowledge that supply is the issue.”

Asked if he thinks the president is putting politics ahead of energy security, Hastings said, “I will just say this as kindly as I possibly can: And that is…his actions have been 180 degrees from what his words are, in a negative way. So I think what he's trying to do is pacify what the problem is.”

Dealing with high gas prices isn’t the point of the reserve, he said: “The strategic reserve was designed [for] when we come to a point where -- horrors if we ever get to that point -- we wouldn't have any supply at all for a little over a month. And now he's tapping that for obviously just a short-term supply.”

“I think it sets a precedent that will probably be tapped again, and all of that time that erodes the strategic supply,” Hastings added.

The long-term answer, he said, is “an all-of-the-above energy plan.” Hastings on Thursday filed a series of bills that would promote energy exploration on federal lands, which fall under the jurisdiction of his committee.

Copyright 2011 ABC News Radio

Thursday
Jun232011

Obama Admin. to Release Oil from Strategic Petroleum Reserve

File photo. (Comstock/Thinkstock)(WASHINGTON) -- The Obama administration said Thursday it will release 30 million barrels of oil from the Strategic Petroleum Reserve "to offset the disruption in the oil supply caused by unrest in the Middle East."

The U.S. Department of Energy said, "The situation in Libya has caused a loss of roughly 1.5 million barrels of oil per day -- particularly of light, sweet crude -- from global markets. As the United States enters the months of July and August, when demand is typically highest, prices remain significantly higher than they were prior to the start of the unrest in Libya."

The department said the U.S. and its partners in the International Energy Agency will release a total of 60 million barrels of oil over the next 30 days.

"We are taking this action in response to the ongoing loss of crude oil due to supply disruptions in Libya and other countries and their impact on the global economic recovery," said Energy Secretary Steven Chu. "As we move forward, we will continue to monitor the situation and stand ready to take additional steps if necessary."

Copyright 2011 ABC News Radio

Friday
Mar112011

Democrats Want Oil Now from Strategic Petroleum Reserve

Comstock Images/Thinkstock(WASHINGTON) -- With the prices at the pump in the U.S. soaring due to unstable conditions in the Middle East and northern Africa, some Democrats are calling upon President Obama to tap into the Strategic Petroleum Reserve to ease the burden on motorists.

In the House, lawmakers led by Massachusetts Congressman Ed Markey introduced a bill Thursday to release oil from the reserves, which are currently near their full capacity of 727 million barrels.

Markey said that this action would stabilize prices of gas in the short-term while protecting consumers from price gouging.

A similar call to release oil from the reserves came from New Mexico Sen. Jeff Bingham, who chairs the Senate Energy & Natural Resources Committee.

The Democrat said that while there's currently enough supplies, "you’re seeing the price of oil go up in world markets because of the concern that the [Libyan] disruption that’s occurring will get even worse."

Up to now, there's been no move by the White House to tap into the SPR.  Republicans say the reserves are intended to be used only if flow of fuel is disrupted by a natural disaster or a blockade of oil imports.

Copyright 2011 ABC News Radio

Tuesday
Mar082011

US Unlikely to Tap into Strategic Oil Reserves, Experts Say

Comstock Images/Thinkstock(WASHINGTON) -- With gasoline prices soaring fast, there has been some talk by the Obama administration to tap into the nation’s Strategic Petroleum Reserve to help ease some of the pain at the pump.

But most fuel analysts say it's not worth the effort, even as prices have zoomed up 40 cents a gallon in the past month because of unrest in the Middle East and northern Africa.

White House chief of staff Bill Daley has talked about releasing just over four million barrels from the reserve, which is currently at its capacity of 727 million barrels.

While four million sounds impressive, it's not.  That's the equivalent of what U.S. motorists use in just a half a day of driving.

There are reasons to leave the Strategic Petroleum Reserve alone.  Analysts explain that crude stockpiles are now above their four-year average and there's not been steep decline in oil imports, despite all the problems in Libya and elsewhere.

Still, futures traders are exploiting the crisis anyway, sending the price of crude well past $100 per barrel, which ultimately affects what we all pay at the pump.

Copyright 2011 ABC News Radio

Sunday
Mar062011

President Obama to Tap Into Strategic Oil Reserve?

ABC News(WASHINGTON) -- Skyrocketing gas prices apparently have President Obama quite concerned. White House Chief of Staff William Daley said Sunday that the administration is looking at all options to combat the issue, including tapping into the Strategic Petroleum Reserve (SPR) -- 727 million barrels stored away for an emergency.

“All matters have to be on the table when you go through, when you see the difficulty coming out of this economic crisis we're in and the fragility of it,” Daley said on NBC’s Meet the Press.

The national average for a gallon of gas is now $3.38.

“The president is extremely concerned about this,” Daley said. “Our economic team has been working with international organizations to make sure that we're coordinated.”

“The issue of the reserves is one we're considering,” he explained. “It is something that only is done, and has been done on very rare occasions. There's a bunch of factors that have to be looked at.”

Some drivers would like to see the government step in.

“It would be nice if there were reductions maybe, some gasoline taxes,” one driver told ABC News.

But others say the situation is far from dire.

“I think they've got to let the market work,” said another driver. “The strategic oil reserve is there for emergencies -- this is not an emergency.”

Oil analyst Robin West says this is not what the Strategic Petroleum Reserve was built for.

“It was really built to deal with interruption of supply,” West said. “I think that it would be a serious mistake to open SPR now.”

But Americans are being hit hard at the pump, with prices well over $4 per gallon in some areas.

“I need a break from these prices,” a Washington, D.C., driver said. “It's tough for families these days.”

Copyright 2011 ABC News Radio







ABC News Radio