President Joe Biden has ordered a historic release of 180million oil barrels from the US’s emergency reserves over the next six months, in an effort to drive down gas prices he’s blamed on Russian President Vladimir ‘Putin’s price hike’.
Biden’s plan calls for taking out one million barrels daily, and represents the biggest release in the oil reserve’s nearly 50-year existence.
‘Our prices are rising because of Putin’s actions. There isn’t enough supply. And the bottom line is if we want lower gas prices we need to have more oil supply right now,’ Biden said on Thursday from the White House.
Biden added that ‘Putin’s price hike is hitting Americans at the pump’, and, ‘I know how much it hurts’.
Gas prices averaged $3.30 per gallon at the start of the year and have gone up to about $4.20 ‘because of Putin’s war’ on Ukraine, Biden said. It is not known how much gas prices could drop with the oil reserve release, but it could be ‘anything from 10 cents to 35 cents a gallon’, Biden said.
‘Your family budgets to fill a tank,’ he said. ‘None of it should hinge on whether a dictator declares war.’
Biden’s announcement came hours after Putin threatened to cut gas supply to ‘unfriendly countries’ starting on Friday. In a televised address, Putin said foreign buyers would be required to ‘open rouble accounts in Russian banks’ to be used to pay for ‘gas delivered starting from tomorrow’.
Biden in his address urged Congress to put financial penalties on oil and gas companies that lease public lands but are not producing, and instead profiting. The president also stressed the need to reduce dependence on fossil fuels and said he would invoke the Defense Production Act to encourage mining for electric vehicle battery materials.
The US consumes about 20million oil barrels daily, while the world’s consumption is around 100million barrels per day. Biden’s action is designed to put more oil on the global market and potentially ease prices at the pump.
Biden closed his remarks by again bringing up the impact that Russia’s war on Ukraine is having on the economy.
‘Look, I know gas prices are painful. I get it. My plan is going to help ease that pain today and safeguard against tomorrow,’ he said.
‘I’m open to ideas and to strengthen the plan, but I will not be put off and put it on hold. I will do everything at my disposal to protect you from Putin’s price hike. It’s not time for politics. Americans can’t afford that right now.’
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