WASHINGTON, D.C. – In an effort to bring down gas prices for Americans and to
combat a sharp rise in oil prices amid Vladimir
Putin’s invasion of Ukraine, U.S. Senator Sherrod Brown (D-OH) joined
Senator Jack Reed (D-RI), U.S. Representative Ro Khanna (D-CA), and seven
of their Senate colleagues in leading a bicameral
letter to President
Biden urging the White House to stabilize gas prices and help working families
by releasing oil from the Strategic Petroleum Reserve (SPR). Drawing down oil
from the federal government’s stockpile now and then replacing it later with
less expensive crude could help temporarily keep gas prices down for Americans,
strengthen U.S. national security, and be a good deal for taxpayers.
“As Russia’s invasion of Ukraine continues to cause volatility in
the global oil market, we are writing to urge you to consider using all of the
tools at your disposal to insulate Americans from rising gasoline
prices. This includes an additional release from the Strategic Petroleum
Reserve, the use of diplomatic pressure to encourage global oil producers to
ramp up their output, and restrictions on petroleum exports unless they will
advance our national security goals and lower prices for consumers,” the 10 members
of Congress wrote.
In addition to Senators Brown, Reed and
Rep. Khanna, the letter is also signed by U.S.
Senators Patrick Leahy (D-VT), Richard Blumenthal (D-CT), Ron Wyden (D-OR),
Raphael Warnock (D-GA), Chris Van Hollen (D-MD), Maggie Hassan (D-NH)
and Tammy Baldwin (D-WI).
The SPR
is an emergency stockpile of petroleum maintained by
the U.S. Department of Energy (DOE). It is the largest known emergency
supply of oil in the world, and its underground salt domes in Louisiana and
Texas has the capacity to hold
approximately 714 million barrels.
According
to DOE, the average price paid for oil in the Strategic Petroleum Reserve was
$29.70 per barrel. Today, gas prices have surged to more than $100 per
barrel for the first time since 2014.
In
November, President Biden ordered the release of 50 million barrels of oil from
the SPR to deal with surging gasoline prices in the U.S. which appeared to
temporarily lower prices at the pump.
Crude oil prices represent the biggest factor in terms of the
prices that consumers pay at the gas pump. But the cost of refining,
distribution expenses, taxes, and rent for the gas station also influence the
price at the pump.
Full text of the
letter follows:
Dear President Biden:
As Russia’s invasion of Ukraine continues to cause volatility in
the global oil market, we are writing to urge you to consider using all of the
tools at your disposal to insulate Americans from rising gasoline prices. This
includes an additional release from the Strategic Petroleum Reserve, the use of
diplomatic pressure to encourage global oil producers to ramp up their output,
and restrictions on petroleum exports unless they will advance our national
security goals and lower prices for consumers.
We appreciate your decision last November to release 50 million
barrels of oil from the Strategic Petroleum Reserve and to coordinate that
effort with similar releases by our allies. We believe the current moment calls
for another release to help lower gasoline costs for struggling American
families and businesses.
Due to the pandemic, oil speculators, and worldwide energy price
spikes, Americans consumers are paying $1 more at the pump than a year ago.
Families are having to choose between filling up their cars and putting food on
their kitchen tables. In our home states, high gasoline prices are hurting
families and small businesses still trying to dig themselves out of the
economic fallout of the pandemic. Meanwhile, the major oil companies are pocketing
their highest profits in years, and they are using those profits to issue
higher dividends and buy back stock. We support your pledge to “closely
[monitor] energy supplies for any disruption” and echo your words of caution
that “American oil and gas companies should not exploit this moment to hike
their prices to raise profits.”
Similarly, international oil producers rely on the United States
for their security, yet are lining up with Russia in setting production
targets. At a time when American consumers are suffering because of Russia’s
actions, we should insist that our international partners do more to increase
production and stabilize prices.
Finally, at a time of significant unrest, we should be judicious
in allowing the export of domestically produced petroleum. Today, total U.S.
production of petroleum liquids roughly matches domestic consumption. Indeed,
the Department of Energy projects that the U.S. will reach its highest level of
crude oil production by next year and that net exports of petroleum product
will reach new highs this year. We should leverage that capacity to ensure that
consumers at home are protected and that our global partners have access to
supply no matter what actions Russia takes.
We know that in the long-term, eliminating U.S. dependence on oil
will provide the stability we need to keep energy costs low for American
households. To that end, we were proud to support the Infrastructure Investment
and Jobs Act, championed by your administration, which will invest $7.5 billion
to build out a national network of electric vehicle chargers and $90 billion to
improve public transit systems, including funding for electric buses. We also
believe now is the time to enact your clean energy plan to fight climate change
and further insulate Americans from exogenous energy shocks.
Yet, as states work to implement transformative changes to our
transportation system, Americans will feel increased pain at the pump in the
short-term due to Russia’s actions in Ukraine. We believe the current moment
calls for the Administration to use all its options to help insulate American
households from price spikes being exacerbated by events far from home.
Thank you for your continued leadership on this important issue.
Sincerely,
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