“US consumers feel the impact of higher fuel prices at gas stations and their heating bills, as do US companies, as oil supply is lagging behind demand as the global economy recovers from the pandemic,” the White House said.
The White House stressed that the decision to release 50 million of the 600 million barrels of oil from the strategic reserve was the result of “weeks of consultations” with countries around the world and was made in parallel with the provision of reserves by other major energy consumers, including China, Japan and India, South Korea and Great Britain.
The White House noted that the news of these talks alone contributed to a 10 percent reduction in the price of gas in recent times.
As part of the decision, 32 million barrels will be lent to companies that are to return the raw material to the reserve in the coming years, when oil prices will be lower. The remaining 18 million will be released as a result of accelerating the sale of crude oil previously authorized by Congress.
As reported by Fortune, the movement of the US and other countries may meet with the reaction of OPEC + countries, the largest oil producers, who may revise their plans to increase oil production next year. Despite pressure from Washington and other countries, OPEC + has not yet increased its oil supply.
High energy prices are one of the biggest sources of increased inflation in the US and – as polls show – also contributing to the weakening of President Biden’s ratings. The average price of a gallon of gasoline in the US is now $ 3.40 and while it has started to decline, it is over 50%. higher than in spring 2020