Biden administration plans to release 15 million barrels from U.S. oil reserves

Transcript

AILSA CHANG, HOST:

President Biden will announce tomorrow that the U.S. plans to draw 15 million barrels of oil out of its strategic stockpiles in December. This is part of a really big release that he announced back in March - a total of 180 million barrels - but it comes after the oil cartel OPEC+ said that it would cut production sharply starting next month. NPR White House correspondent Tamara Keith is here to explain more. Hey, Tam.

TAMARA KEITH, BYLINE: Hi, Ailsa.

CHANG: Hey. OK, so explain real briefly why the U.S. is doing this.

KEITH: So you'll remember that President Biden announced a plan to pull 180 million barrels from the Strategic Petroleum Reserve. This news puts a timeline on finishing that job. It will wrap up in December. Announcing it now sends a signal to the markets, including OPEC+ and Russia. There's a lot of uncertainty what might happen with oil supplies globally in December and beyond - what Russia might do in the months ahead as its war with Ukraine drags on and the West continues to amp up the consequences - so the administration is leaving open potentially doing more down the line.

CHANG: OK. But, of course, I mean, this news is coming right before the midterm elections. Can you talk about that part of this? Like, how do politics come into play here?

KEITH: Yeah, after a summer of gas prices falling every day, they jumped back up recently in the Midwest and on the West Coast especially. Last week, traveling with President Biden in California, I asked him whether he had seen the prices of gas out the window of his motorcade, and he was a little bit dismissive.

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PRESIDENT JOE BIDEN: Well, that's always been the case here. You know, it's not - what - nationwide, they came down about $1.35, and they're still down over a dollar.

KEITH: But Biden...

CHANG: Still expensive (laughter).

KEITH: Yes. Yeah, it's definitely still expensive. You know, Biden promised during that conversation that he'd do something more, and his aides do say that he is acutely aware of the pain at the pump that Americans are feeling. It is a pain that has political consequences, as voters consistently rank the economy and inflation as their top issues heading into the midterms, and Republicans have made this a central issue of their campaigns.

CHANG: OK. Well, given all that, I mean, what kind of effect do you expect this will have on gas prices, ultimately?

KEITH: You know, it's unclear how much this will bring down prices in the short term. Much of the recent price spikes had very little to do with oil prices. There was a refinery fire in the Midwest. A bunch of refineries were down in California. And as they come back online, prices have already begun falling significantly. These actions are really aimed at trying to hedge against uncertainty a couple of months from now, with the war in Ukraine still ongoing. The White House also announced a plan to start buying back oil to refill the Strategic Petroleum Reserve down the line a ways.

CHANG: That is NPR's Tamara Keith. Thank you so much, Tam.

KEITH: You're welcome. Transcript provided by NPR, Copyright NPR.