White House sells additional 20 million barrels from SPR

Business

FILE – A man wears a face mark as he fishes near docked oil drilling platforms, Friday, May 8, 2020, in Port Aransas, Texas. The U.S. Interior Department on Wednesday, Nov. 17, 2021, is auctioning vast oil reserves in the Gulf of Mexico estimated to hold up to 1.1 billion barrels of crude. It’s the first such sale under President Joe Biden and underscores the challenges he faces to reach climate goals that rely on cuts in fossil fuel emissions. (AP Photo/Eric Gay, File)

(NewsNation) — The White House on Tuesday announced that the Department of Energy will release another Notice of Sale to sell 20 million more barrels of oil from the Strategic Petroleum Reserve as part of the Biden administration’s effort to reduce gas prices.

This marks the fifth sale that President Joe Biden has authorized. The White House blamed “disruptions posed by Russia’s invasion” for high gas prices while claiming the Biden administration’s actions are making a difference.

“In fact, the Department of the Treasury estimates that as a result of these drawdowns both domestically and internationally, the price at the pump for Americans is up to about 40 cents per gallon lower than it otherwise would have been,” the White House said.

Gas prices have dropped since the recent average price of gas spiked to more than $5 per gallon in June. On Wednesday, the average is $4.30, compared to $3.15 one year ago.

The White House also announced that the Department of Energy is proposing a rule change regarding how the federal government acquires oil for the strategic reserve. The new rule, if adopted, would permit fixed-price contracts as well as index-price contracts. The current rule requires purchase prices to be set by a price index, with the price paid being based on market prices at the time of delivery.

“This proposal, if finalized as proposed, would encourage near-term production, promote market stability, and put the federal government in a better position to respond to future market volatility,” the White House said.

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