With oil and gasoline prices rising dramatically, Republicans and Democrats alike are demanding action to keep energy costs from shattering the fragile economic recovery. The national average price for a gallon of gas hit $3.65 last week, inching perilously closer to the critical $4-a-gallon level. While GOP politicians are reviving their "drill, baby, drill" calls, saying increasing domestic oil supply is the key to energy independence, Democrats are urging President Obama to tap into the nation's Strategic Petroleum Reserve to bring down oil prices. Should Obama turn on the spigots?
Obama should tap into the reserves: When Libya's civil war shut down the African nation's oil exports last year, President Obama released some of the oil reserve, says Douglas A. McIntyre at 24/7 Wall St. That helped bring oil down from $100 a barrel to about $80 in just over a month. Now, fear of trouble in Iran is pushing prices skyward. "It is time to make the same decision again," if only to show consumers the administration won't "stand idly by" while they go broke on $4-a-gallon gas.
"Release Strategic Petroleum Reserve supply"
Hold on. This might not work: The 276-million-barrel oil reserve is meant to replace "a sudden and severe loss" of supply, says Brad Plumer at The Washington Post, "as happened after Hurricane Katrina, when 25 percent of U.S. production in the Gulf of Mexico went offline." Today's predicament may not qualify. And even if Obama does tap our reserves, it might not work. When he released oil last June, prices were already on the way down, and some analysts think the move had "little long-term effect."
"Could Obama tap our strategic reserves to lower gas prices?"
Plus, it's too risky: Tapping the reserves could create all kinds of political headaches, say Guy Chazan and Jack Farchy at Financial Times, by "straining relations between the West and the producers' cartel OPEC, which would see it as a political weapon." And it might be premature. America should arguably keep its powder dry until there's "a real emergency," like Iran closing a key oil shipping lane. The safe, smart move would be pressing Saudi Arabia to pump more oil to increase supply and keep prices from continuing their climb.
"Obama pressed to open emergency oil stocks"
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