Washington will stop tapping its reserves and focus on ramping up production
© Getty Images / Kentaroo Tryman
The US does not plan to extend oil releases from its Strategic Petroleum Reserve (SPR), which are scheduled to end in the fall, Amos Hochstein, US President Joe Biden’s Special Presidential Coordinator for International Energy Affairs, said in an interview with Yahoo Finance on Friday.
“We can’t be an oil supplier. It’s a reserve and so we have to keep that,” Hochstein was cited as saying. He noted that tapping the reserve “was really a stop-gap measure,” and other steps must be taken in order to lower the prices at the pump.
According to Hochstein, US oil producers assured him they will be able to increase production.
“I myself had those conversations with the leadership of several of the companies,” he added, noting that some of them have already launched the processes needed to boost output.
The official noted that this should allow the US to secure oil supplies for the upcoming fall and stem the fears of price spikes.
“There’s a little bit of hysteria at the moment in the analysis of oil markets,” he stated, but said the worry is overblown, especially given the fact that while some experts predicted record-high gasoline costs during the peak summer driving season, the prices have instead declined.
As of Saturday, the price of West Texas Intermediate crude oil futures was a little over $95 a barrel, and the average price at the pumps in the US stood at $4.38 per gallon, down from the record high $5 per gallon reached last month. Gasoline prices in the country have been declining for 38 days in a row, “among the fastest in over a decade,” according to Cecilia Rouse, chair of the Council of Economic Advisers.
Hochstein earlier predicted that gasoline prices would soon “come down more towards $4,” and reiterated this forecast to Yahoo Finance, saying Washington will do everything in its power to get the prices down.
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