The plan is to release 50 million barrels of oil. For context, the United States uses about 20 million barrels of oil per day. That’s like augmenting the demand by less than 1% of annual consumption. It’s a pittance that’s less than a drop in the ocean, more like a vapor in the ocean. It’s a “do something” kind of move that looks like the administration is acting, though it’s really just a bit of petroleum theater aimed at giving Democrats something to point to when voters complain about high gas prices under an administration that hates oil companies and hates fossil fuel in general.
Why bother releasing oil from the strategic reserve? Just allow more domestic drilling, as was the case under President Trump, and we’d have more oil than we need. Instead, we get this meaningless action from a dunce administration:
The Department of Energy will release 50 million barrels of oil from the Strategic Petroleum Reserve, according to the White House. 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.
Did you catch the last line? These barrels will not reach the market until mid to late December, and then be spread over the coming months, meaning the limited impact they have won’t happen for over a month from now. Essentially, the impact will be zero with regard to a long-term strategy to get gas prices under control. This is a temporary bandaid that does nothing to actually stop the bleeding, and the bandaid is way too small to even cover the wound.
This type of move is usually shunned by most administrations because the strategic petroleum reserve is there for emergencies. It’s there for cases like war or serious disasters where the U.S. oil supply is disrupted for the long term or turned off entirely. It’s like an emergency fund for a domestic oil supply, and it’s usually not touched merely for political reasons because a failing President doesn’t know what to do about his economy-crushing policies.
It’s a sign of desperation since it’s one of the only things the government can directly do to immediately increase the supply of oil. As noted above, however, that increase is nominal, and barely measurable when it comes to daily or weekly gasoline consumption in the United States.
The White House is desperate to take anything and run with it even if it’s destined to solve nothing:
“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.”
Global oil supply wouldn’t be an issue if we had kept up with our own domestic oil production. The global supply shouldn’t mean anything for America since we have more oil production available domestically for the next several hundred years. There is no reason to bow to the environmental factions around Biden, demanding we exchange oil refineries for windmills. We should drill here and drill now.
The Biden administration already knows this will accomplish nothing, but they want to at least get a point on the board and Congressional Democrats are starving for good news to share with their constituents:
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.
This is a losing proposition for the country. We will get a few barrels of oil in exchange for Biden to have a talking point. In the long-term, we’re headed in the wrong direction when it comes to creating a strong and healthy domestic supply of affordable and reliable oil production.
