On Thursday, U.S. Department of Energy Secretary Steven Chu announced that the U.S., along with its partners in the International Energy Agency, has decided to release a total of 60 million barrels of oil from strategic reserves within the next 30 days. This move is to offset the disruption in oil supply caused by continued unrest in the Middle East. For its part, the U.S. will release 30 million barrels of oil from its Strategic Petroleum Reserve (SPR). According to the DOE, the SPR currently has 727 million barrels of oil.
Energy Secretary Steven Chu had this to say of the U.S. government's decision to tap into the SPR:
[Source: U.S. Department of Energy]
Energy Secretary Steven Chu had this to say of the U.S. government's decision to tap into the SPR:
The situation in Libya, according to the DOE, causes a loss of roughly 1.5 million barrels of oil per day. Some say soaring gas prices here in the U.S. are a direct result of the turmoil in Libya so, in theory, tapping the SPR should drive down pump prices. That's not how these things work, as we'll probably find out in, um, around 20 days.We are taking this action in response to the ongoing loss of crude oil due to supply disruptions in Libya and other countries and their impact on the global economic recovery. As we move forward, we will continue to monitor the situation and stand ready to take additional steps if necessary.
[Source: U.S. Department of Energy]
Department of Energy to Release Oil from the Strategic Petroleum Reserve
Washington, DC - U.S. Energy Secretary Steven Chu announced today that the U.S. and its partners in the International Energy Agency have decided to release a total of 60 million barrels of oil onto the world market over the next 30 days to offset the disruption in the oil supply caused by unrest in the Middle East. As part of this effort, the U.S. will release 30 million barrels of oil from the Strategic Petroleum Reserve (SPR). The SPR is currently at a historically high level with 727 million barrels.
"We are taking this action in response to the ongoing loss of crude oil due to supply disruptions in Libya and other countries and their impact on the global economic recovery," said Energy Secretary Steven Chu. "As we move forward, we will continue to monitor the situation and stand ready to take additional steps if necessary."
The United States has been in close contact with oil producing and consuming countries about disruptions to the international oil market that could affect the global economy. The situation in Libya has caused a loss of roughly 1.5 million barrels of oil per day - particularly of light, sweet crude - from global markets. As the United States enters the months of July and August, when demand is typically highest, prices remain significantly higher than they were prior to the start of the unrest in Libya.
The Administration will continue to consult closely with other consuming and producing countries in the period ahead. The decision today is intended to complement the production increases recently announced by a number of major oil producing countries. The United States welcomes those commitments and encourages other countries to follow suit.
Washington, DC - U.S. Energy Secretary Steven Chu announced today that the U.S. and its partners in the International Energy Agency have decided to release a total of 60 million barrels of oil onto the world market over the next 30 days to offset the disruption in the oil supply caused by unrest in the Middle East. As part of this effort, the U.S. will release 30 million barrels of oil from the Strategic Petroleum Reserve (SPR). The SPR is currently at a historically high level with 727 million barrels.
"We are taking this action in response to the ongoing loss of crude oil due to supply disruptions in Libya and other countries and their impact on the global economic recovery," said Energy Secretary Steven Chu. "As we move forward, we will continue to monitor the situation and stand ready to take additional steps if necessary."
The United States has been in close contact with oil producing and consuming countries about disruptions to the international oil market that could affect the global economy. The situation in Libya has caused a loss of roughly 1.5 million barrels of oil per day - particularly of light, sweet crude - from global markets. As the United States enters the months of July and August, when demand is typically highest, prices remain significantly higher than they were prior to the start of the unrest in Libya.
The Administration will continue to consult closely with other consuming and producing countries in the period ahead. The decision today is intended to complement the production increases recently announced by a number of major oil producing countries. The United States welcomes those commitments and encourages other countries to follow suit.
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