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Biden will tap oil reserves in hopes of pushing gasoline prices down.

Energy experts said the release of the reserves would have more clout if other countries like China also sold oil from their stockpiles. The International Energy Agency, an organization of more than 30 countries, will meet on Friday and may recommend further releases from national reserves.

Russian oil exports typically account for more than one in ten barrels the world consumes. The United States, Britain and Canada have stopped importing Russian oil, and many oil companies and shippers in Europe have voluntarily stopped buying Russian energy products. So far, this has led to a deficit of about three million barrels a day.

The average price for regular gasoline in the United States is $4.23 per gallon, according to AAA, the motor club. That’s about the same as a week ago, but up 62 cents a gallon over the past month.

Oil prices fell this week after peace talks between Russia and Ukraine showed signs of progress. Energy traders are also worried demand could fall as China, the world’s biggest oil importer, imposes lockdowns in Shanghai and elsewhere to deal with the coronavirus outbreak.

“The price effect will likely be short-term,” David Goldwyn, a senior State Department official in the Obama administration, said of Mr. Biden’s announcement. “Part of the benefit of this release, however, is that it will bridge the gap as new physical shipments from the US, Canada, Brazil and other countries come online in the second half of this year.”

Some environmentalists have criticized the reserve release. “Putting more oil on the market isn’t solving our problem, it’s perpetuating our problem,” said Mark Brownstein, senior vice president of the Environmental Defense Fund.

But Meghan L. O’Sullivan, director of the Geopolitics of Energy Project at Harvard Kennedy School, said releasing reserves to alleviate shortages would not threaten the clean energy transition. “What the past month has told us is that if there is no energy security today, the appetite for hard steps on the transition path will evaporate,” she said.

https://www.nytimes.com/2022/03/31/business/energy-environment/biden-oil-strategic-petroleum-reserve.html Biden will tap oil reserves in hopes of pushing gasoline prices down.

Ian Walker

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