US President Joe Biden, faced with record inflation undermining his popularity, will tap into America’s huge oil reserves as never before to try to stem soaring prices at the pump.
He ordered to draw one million barrels a day from strategic oil reserves for six months, an initiative ” unprecedented “ in American history, announced the White House, Thursday, March 31. The prospect of this record spill of American black gold was already lowering prices on Thursday in London and New York by around 5%.
This initiative should, according to a statement from the US executive, serve to “to make the transition until the production [américaine] increases at the end of the year. The US administration will use revenue from the sale of these reserves to replenish stocks ” in the years to come “.
The White House, which the Republican opposition accuses of weighing down oil activity in the United States, promises to “do everything [qu’elle] can “ to encourage extraction in the United States. Joe Biden, for example, is now asking Congress to impose fines on companies that have the necessary permits and land, but do not operate them.
Still with the idea of strengthening American energy independence, the president will invoke the Defense Production Act, a text inherited from the Cold War which allows him to take economic decisions by decree, to encourage the development of green energies.
The Democratic president has been trying since the invasion of Ukraine to blame Russian President Vladimir Putin for soaring inflation, even though the rise in prices had started before. But this rhetoric does not seem to convince Americans, as legislative elections approach in the fall which threaten to reduce Joe Biden to impotence for the rest of his mandate. His confidence rating barely exceeds 40%, according to various polls, a very low level.
The US Strategic Petroleum Reserves were created in 1975 to counter oil shocks. Buried in huge salt caverns up to 800 meters deep along the coast of the Gulf of Mexico, they can store up to 714 million barrels of black gold but currently hold 568 million barrels.
The American administration has already been drawing continuously from these strategic reserves since the fall, when the rise in oil prices set in: it announced in November that it wanted to release 50 million barrels, then again 30 million at the start of March.
According to the latest inflation indicator, the PCE index published Thursday by the Commerce Department, consumer prices continued to climb in March in the United States, rising by 6.4% over one year and by 0.6% over one month. With the approach of the mid-term legislative elections, the White House has made the fight against this runaway prices – unheard of since the 1980s – one of its priorities.
On March 7, oil reached historic price records reached during the 2008 financial crisis, exceeding 130 dollars a barrel, before falling back to between 100 and 110 dollars currently. The price of gasoline at the pump in the United States exceeded its 2008 peak, well above 4 dollars per gallon (3.78 liters).