As oil prices, a key indicator of perceived inflation, are rising as November’s mid-term elections are three weeks away, President Joe Biden is rolling out an additional strategic oil reserve.
As the issue of high prices, an economic issue, has become a hot topic in the elections, support from the Democratic Party is waning, so it’s an emergency response.
White House Press Secretary Carine Jean-Pierre said in a briefing on the 18th that when asked about the announcement of the release of additional strategic oil reserves, “there will be an announcement tomorrow (19)”.
“President Biden will share more on what[il governo]it is doing and what it will do to bring oil prices down, “he said.
President Biden criticized the Organization of Petroleum Exporting Countries (OPEC) Plus’ decision to cut production on the 5th and ordered that the issue of releasing another 10 million barrels of strategic oil be considered in November.
Previously, US media reported that President Biden plans to release additional strategic oil reserves soon.
Strategic oil reserves are oil stored in salt caves in Texas and Louisiana to respond to emergencies where oil supplies are suddenly cut off.
It is also a tool that the president, the head of the US administration, can fully use to curb the surge in prices.
In May of this year, President Biden began releasing 180 million barrels of strategic oil to stabilize prices.
Reuters reported that the strategic oil reserve to be released this time is 14 million barrels remaining, the largest amount ever released this year. According to the US Energy Information Administration, the average US oil consumption last year was about 20 million barrels per day.
The Biden administration is also discussing with oil companies a plan to release and sell another 26 million barrels in fiscal year 2023 (October 1, 2022 – September 30, 2023) as indicated by Congress.
President Biden’s release of strategic oil is a measure to curb rising consumer prices, a major complaint among Americans today.
The US is suffering from high inflation due to excessive monetary policy easing and changes in the commodity supply chain after the war in Ukraine.
In particular, rising gasoline prices is the main cause of rising consumer prices and is an essential commodity that serves as a standard for the price Americans experience in their daily lives.
According to the American Automobile Association (AAA), the average gasoline price in the United States was $ 3.89 per gallon today, up 20 cents from last month and 56 cents from the same period last year. .
Gasoline milk prices jumped to $ 5 per gallon in June of this year. Currently, the White House is said to view $ 4 as a marginal line.
Reuters and Bloomberg reported that the plan will go into effect ahead of the November 8 mid-term elections in the United States.
The US mid-term elections are a major political event in which 35 out of 100 US senators, 435 of the US House of Representatives, and 34 out of 50 governors are elected.
In particular, it is an interim evaluation of the incumbent president and means to look forward to the next presidential elections.
The Republican Party, the opposition party in the United States, uses high prices as a key criticism of the ruling party to win a majority in the House and Senate in the midterm elections.
President Biden also clashed with uncooperative Middle Eastern oil producing countries over the effect of inflation on public opinion and put pressure on the oil industry.
A source told Reuters about the release of strategic oil reserves: “There is a short time before the mid-term elections to lower fuel prices, but at least it will show that we are working on it.”
The Biden administration is also discussing controlling oil exports to stabilize oil prices, but it is reported that an internal agreement has not yet been reached.
