The White House said on Tuesday it would release millions of barrels of crude oil available from the U.S. Strategic Petroleum Reserve (SPR) to help reduce rising oil prices. The national average for a gallon of gas is $3.41, which is $1.29 more than it was a year ago. Under the plan, the United States will release 50 million barrels, the equivalent of about two and a half days of U.S. demand. The SPR release is being conducted in conjunction with reserve releases by China, India, Japan, the Republic of Korea, and the United Kingdom.
The SPR release was announced amid low approval ratings for the president and rising inflation ahead of next year’s congressional elections. Crude oil prices recently reached seven-year highs after cratering in 2020 due to COVID-19 related shutdowns. Retail gasoline prices are up more than 60% in the last year, the fastest rate of increase since 2000. Higher prices are due to a sharp increase in crude demand as consumers and businesses get back on the road now that pandemic-induced restrictions have eased. Market analysts expect the coordinated release to have only a temporary effect on international crude oil prices. Crude oil futures turned higher November 23 as the market weighed the coordinated release against a possible response from the OPEC+ producer bloc. The reserve currently holds about 606 million barrels of crude stored in salt caverns located on the Louisiana and Texas coasts.