Biden Weighs Tapping Strategic Reserves As He Threatens OPEC+ With “Undisclosed Tools”
The Biden administration is considering tapping into the nation’s Strategic Petroleum Reserve (SPR) to lower prices at the pump. Biden has even touted an “arsenal of tools” to deal with OPEC+ to boost crude output.
On Monday, Energy Secretary Jennifer Granholm told MSNBC “an announcement” could come this week to address the highest gasoline prices in seven years. Soaring fuel prices have put pressure on the Biden administration to act.
President Biden is “certainly looking at what options he has in the limited range of tools a president might have to address the cost of gasoline at the pump, because it is a global market,” Granholm said.
Over the weekend, Biden threatened OPEC+ with an undisclosed “arsenal of tools.”
“There are other tools in the arsenal that we have to deal — and I’m dealing with other countries; at an appropriate time, I will talk about it — that we can get more energy in the — in the pipeline, figuratively and literally speaking.”
The mentioning of “arsenal of tools” came in response to whether Washington would tap the SPR as a means to flood domestic fuel markets with supply to lower prices.
Since July, Biden has urged OPEC+ to increase output as recovering demand for crude products pushed prices at the pump to very politically uncomfortable levels ahead of midterms. Last week, OPEC+ snubbed Biden’s calls to increase output, which begs the question of what “tools” the president has to sway the oil cartel.
This week’s decision to tap the strategic reserves will do very little to alleviate structural issues like US crude production, which is well under pre-pandemic levels.
It turns out US shale doesn’t have the support from the government or shareholders to boost production and take on OPEC+, as we’ve seen before. OPEC+ seems satisfied with current prices and is unlikely to change its stance as Biden’s tools to sway the cartel are likely fluff.
This entire spectacle shows just how desperate the Biden administration is to tame energy inflation that is showing up at the pumps ahead of midterms. Judging by the president’s polling data, voters are not that thrilled with soaring fuel prices.
By the end of the week, or in the very near term, the president or Granholm will likely announce SPRs will be tapped – which solves absolutely nothing about the structural issues in the energy complex (and may not even provide a temporary easing of pain for the average joe). The administration needs to encourage and support US shale to raise production but, of course, that goes against their “green agenda” to decimate the fossil fuel industry.
Finally, by way of example of the farcical dilemma he finds himself in, Biden and his administration were reportedly exploring the closure of yet another domestic pipeline while begging OPEC+’s leader, Saudi Arabia, for more oil (and enabling Russia’s NS2 pipeline) in an apparent shift away from America’s energy independence.
… and yes, Biden did do that.