Washington, D.C. – Today, Daniel J. Weiss, Senior Fellow and Director of Climate Strategy at the Center for American Progress, released the following statement on the Obama administration’s decision to release 30 million barrels of oil from the emergency Strategic Petroleum Reserve:
Selling surplus reserve oil should lower oil and gasoline prices, which will act like a tax cut for American families. Lower prices will mean fewer dollars going overseas. In the long run, the Obama administration can help save families even more money by issuing fuel-economy standards of 60-plus miles per gallon by 2025.
In CAP’s column released in February, “The False Promise of ‘Drill, Baby, Drill,’” Weiss argues that in addition to selling oil from the Strategic Petroleum Reserve, using some of the proceeds from the sale to pay for public transportation trips would encourage people to drive less and also reduce prices in the short term. A previous emergency SPR sale, ordered by President George W. Bush after Hurricane Katrina, was on the market in 17 days and prices dropped 12 percent in a month. These short-term measures to lower prices must also be accompanied by a robust effort to ensure the Commodities Future Trading Commission has the needed staff to enforce safeguards to prevent speculators from driving up oil prices as they did in 2008.
Looking toward longer-term measures to sustain lower oil prices, the “Cleaner Cars, Less Foreign Oil” plan endorsed by CAP, the League of Conservation Voters, and Sierra Club, advocates for the promulgation of a 60-plus miles per gallon vehicle standard by 2025. This fuel-efficiency standard will continue the push to save consumers money, create jobs, and reduce our reliance on foreign oil by decreasing our oil consumption.
The White House cited the loss of oil production due to the conflict in Libya and increased energy demands over the summer as the reason for the release of the 30 million barrels of SPR oil, to be part of a globally coordinated effort with partners at the International Energy Agency, resulting in the cumulative release of 60 million barrels over the next 30 days. The SPR is currently at a historically high level with 727 million barrels. The sale of SPR oil should generate at least $2.5 billion in federal revenue.
To speak with Daniel J. Weiss on the announcement, please contact Christina DiPasquale at 202.481.8181 or [email protected].
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