Biden stated that President Biden used the strategic oil reserve to follow the example of other large economic and energy nations like China, India and North Korea.
Washington (apro). In an attempt to reduce fuel prices (particularly gasoline and diesel), Joe Biden, US President, directed the release of 50,000,000 barrels of oil from his strategic reserve. This was reported by the White House.
In a press statement, President Biden said that the decision not to use the strategic petroleum reserve was in line with other major economic powers like China, North Korea and India.
According to the White House’s explanation, the decision was made after “weeks of negotiations” with other countries in the same situation as the United States, and fuel prices continued to rise.
The United States has been importing oil from other countries, which has resulted in a 10% drop in fuel prices. This is something Americans have yet to see.
The White House stipulated that Biden’s order to release 50 million barrels of strategic oil reserves to the Department of Energy will have two aspects.
First, 23 million barrels will be released within the next few months. The strategic reserves will eventually need to be returned within a few decades; this exchange is a tool for matching market fuel prices.
The White House stated clearly in its notice that 18 million barrels were to be added, as the US Federal Congress authorized. This will allow for the sale on the national consumer markets.
Biden claims that this exchange is for more oil to fuel supply chains in the 50 US states is an easy solution because there is more energy stored and therefore prices will fall.
The White House stated that the 50 million barrels of Strategic Oil Reserves were released as a response to global macroeconomic pressures caused by the Covid-19 Pandemic. It has also triggered inflation in recent 18 months.
According to statistics provided by the US federal governments, the annualized rate of inflation (increased prices for goods and/or services) was 6.2% in this period.
Biden believes that his country is experiencing a healthy macroeconomic rebound despite inflationary pressures. This partly reflects its recent spending on infrastructure projects and social programs approved by Congress.