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Biden plans an exit from SPR crude oil in the next few days

A release of this magnitude would represent about three days of crude oil production in the United States.

A White House spokesman said no decision has yet been made on an oil release from the SPR.

“Conversations are ongoing and we are considering a range of tools for if and when action is needed,” the White House spokesman said.

Bloomberg News first reported the likelihood of an SPR release earlier on Monday.

Energy Secretary Jennifer Granholm has repeatedly raised the possibility in recent weeks that the administration could exploit the SPR, as rising fuel prices have upset the general public and helped push down the ratings of public approval of Biden.

The release of oil from reserves – which are stored in a network of salt caves in Louisiana and Texas and currently total 604 million barrels of crude – normally occurs when refinery supplies are disrupted by events like hurricanes, though. that presidents have used in recent years these. barrels for more mundane reasons to try to control prices.

Even though the Biden administration does not immediately release oil from the SPR, budget legislation passed by Congress in 2015 and 2018 mandates the release of the SPR in 2022.

President Joe Biden and his administration have urged OPEC + oil-producing countries to open their taps further to help reduce global oil prices that contribute to inflation. OPEC has so far not publicly stated that it will do so, although it acknowledged in its November report that high prices could threaten the current global economic rebound.

A person familiar with White House thinking said the administration had not made a final decision to release the oil, and that US officials hoped the threat of an SPR release would persuade OPEC and the Russia to increase their export quotas beyond the recent decision to allow an additional 400,000 barrels per day to come on the market.

Oil prices have fallen slightly since reaching a seven-year high of $ 84 a barrel in mid-October. Experts attribute the price hike to the rebound in global demand as countries gradually reopen their economies after the pandemic eroded demand. But so far oil producers, including U.S. companies, have been cautious about drilling for new sources of supply amid the uncertainty surrounding the economic outlook.

This helped push gasoline prices above $ 3.40 per gallon, up about 60% a year ago, but off the seven-year peaks seen earlier this month. .

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