The Strategic Petroleum Reserve (SPR) was created after the oil embargo of 1973 to assure the nation’s energy needs during a national crisis such as war, an embargo, a terrorist attack, a hurricane, or for the needs of a close ally threatened by such an embargo ( i.e. Israel) or other unplanned interruption of essential fuel oil.
The plan called for the storage of nearly one billion barrels of oil in geological features called “salt domes” (massive homogeneous deposits of mineral salt deep below the surface) mostly located on the nation’s Gulf Coast. At present, the several reserve locations are almost two-thirds full, holding some 600 million barrels of petroleum. The supply can last, based on current usage, for about 36 to 60 days, were it needed. The oil is accessed in a manner similar to tapping a normal oil well. The oil is pumped to the surface through a pipe, where it is then transferred to refineries for distillation or for other purposes. The rate of supply is constrained to about 4 million barrels per day as a result of the way the oil is accessed.
SPR oil is a STRATEGIC RESOURCE, not one to be used for base political purposes. However President Biden, ignoring the long term and the reserve’s actual purpose, has just released 50 million barrels of oil from the SPR. . His stated goal is to help lower the price of oil and gasoline which has jumped in price, climbing to a seven year high of almost $4 dollars per gallon. The price of gasoline at the pump has only underscored the inflationary surge of recent months rising to 50% higher than only a year ago. The price of gasoline is a potent political embarrassment and a drag on the popularity polls of the Biden team.
But the President’s action is an irresponsible act of political theater. One glaring reason to castigate our President is that the problem Biden is attempting to “solve” by releasing and misusing our SPR oil is (like many of the the nation’s other recent crises and problems) one Biden caused himself.
The high price of oil gas and gasoline are in large part the result of President Biden’s early misguided actions to reduce dependency on fossil fuels and other so called “green” initiatives which closed opportunities for oil exploration and drastically reduced investment in oil and gas development.
Furthermore, the 4 million barrels per day he is releasing is unlikely to change the price of heating oil or gasoline significantly. We use approximately 18 million barrels of oil per day (2020). The 4 million bbl of SPR oil would represent about only 20% of the total. In fact we import about six million barrels per day from OPEC nations (2020). These oil producing nations all have a powerful incentive to keep prices high. Were each OPEC nation to simply lower production by a small amount , the drop in world production would quickly nullify any effects of the Biden release. Thus the act of using the SPR to bolster his plunging popularity polls is just an irresponsible and desperate act of political theater. Designed to give the appearance that our very unpopular President is actually doing “something” other than shuffling around, playing at being President, creating his own crises and doing not much else.
Thus this act is only political posturing of desperation that will waste a strategic reserve, and produce no significant effects for suffering US citizenry. The sad fact is that the way Biden is governing, we may soon desperately need that oil in the SPR before he retires from office.
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