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In his eagerness to improve the country’s economic conditions in record time, the US president explained his strategy to release 15 million barrels of oil from the country’s strategic reserves, drawing the attention of the producing companies so that they do not take advantage of the situation and announced the financing of more projects linked to clean energies. All in a plan against the clock in the face of the mid-term elections.
It is the latest move to calm volatile fuel prices. US President Joe Biden now wants to increase the number of barrels of oil available on the market to drive down costs.
“Today, I am announcing three critical steps my Administration will take to reduce gasoline prices. The first is that the Department of Energy will release another 15 million barrels from the Strategic Petroleum Reserve, extending our previously announced release through the month of December (…) The Government is going to buy oil to recharge the Strategic Petroleum Reserve when prices drop to 70 dollars a barrel”.
Currently, the scarcity of hydrocarbon has caused its value to increase considerably, since the demand for it has not stopped and there are few who can supply it.
The president of the world’s largest economy has had to face this month with announcements of an imminent recession in the next 12 months, annual inflation above that expected by the central bank and citizens concerned about the country’s economy.
The month did not start very well for his Administration, when on October 5 the Organization of the Petroleum Exporting Countries and its allies (OPEC+), led by Russia, announced that they were going to cut daily crude oil production by two million barrels per day to from November.
Some time later, the Government of Saudi Arabia accused Biden of having tried to persuade the leaders of the organization to postpone the decision to cut supply, due to political affections for the president; however, the announcement of the club of the great producers was imminent.
With very few options, President Biden again called the attention of several American companies that, according to him, have not increased oil production despite the fact that they are making significant profits.
“My message to American energy companies is this: You shouldn’t use your profits to buy back shares or to get dividends. Not now, not while a war is raging. You should use these record profits to increase production and refining. Invest in America for the American people. Reduce the price you charge at the pump to reflect what you pay for the product,” Biden said from the White House on Wednesday, October 19.
With a view to renewable energy
While seeking control of the oil sector, Biden also advanced his clean energy strategy and announced the financing of 20 US companies that will develop materials for the production of batteries for electric vehicles, with the aim of boosting domestic manufacturing and accelerating the transition to vehicles that do not use hydrocarbons. The announced investment is for 2,800 million dollars.
“You can ramp up oil and gas production now while still going full throttle to accelerate our transition to clean energy. That way, we can reduce energy costs for American families and improve our national security at a very difficult time.” Biden said at the press conference.
This week the president has repeatedly recalled the bills that his administration and caucus in Congress have brought forward to control inflation. Among those, the reduction of student loans, improvements in the health system and laws to contain the Consumer Price Index (CPI).
With Reuters and AFP
