The White House caught everyone off-guard Thursday by announcing that it would release about 30 million barrels of crude oil from emergency reserves, as part of a multinational effort aimed at boosting supplies and bringing down gas prices.
In all, members of the International Energy Agency — the oil-importing nations’ answer to the OPEC cartel — plan to release 60 million barrels. The stated rationale was making up for the 1.4 million barrels a day not being supplied due to the Libyan civil war. The fact that crude prices were up almost 20 percent this year, before falling Thursday to a four-month low, was also surely a factor.
So, too, was the agony in the U.S. over gas prices that, in metro Atlanta and elsewhere, hit an average of more than $4 a gallon at one point this spring.
That said, the Associated Press reported two interesting facts about the size and timing of the release:
[T]he 30 million barrels to be sold by the United States represents less than two days’ worth of domestic oil consumption and about three days of oil imports. …
The move comes as retail gasoline prices dropped for the 20th consecutive day, down a penny from Wednesday, to $3.61 per gallon, according to the AAA Daily Fuel Gauge Report. That’s about 21 cents lower than a month ago.
Was releasing oil from emergency reserves a good move?
Total Voters: 234
A skeptic might suggest the move is much ado about nothing. A cynic might suggest that President Obama knows that, and was simply trying to pick up a few political points for a development that was already under way. A worrier might suggest that releasing some of the reserves absent a true supply crunch is a reckless thing to do. An optimist might suggest that, with nearly 700 million barrels still in the reserves, such worries are unfounded. A proponent of the move might suggest that anything that eases gas prices and allows consumers to spend money elsewhere is welcome in a fragile economy.
So, which of those arguments do you buy? Answer in the poll to the left and in the comments thread below.
P.S. — Congratulations to the reader who submitted the name chosen for this new Friday poll question feature, Poll Position. The reader has posted under a few names in the past, but the most recent one was Atticus Finch. Congrats, Atticus; you’re entitled to a little mild gloating in the thread should you wish.
– By Kyle Wingfield