The Biden administration is mulling a release of emergency oil reserves as one of several options to ease a global energy crisis that has resulted in surging prices for consumers, U.S. Energy Secretary Jennifer Granholm said on Wednesday.
"It’s a tool that’s under consideration," Granholm said during an appearance at the Financial Times’ Energy Transition Strategies Summit on Wednesday.
U.S. gas prices surged to $3.21 per gallon this week, marking the highest cost in seven years. Patrick De Haan, head of petroleum analysis for GasBuddy, said prices could reach as high as $3.30 per gallon by the end of the month.
The Department of Energy’s website describes the Strategic Petroleum Reserve as "the world's largest supply of emergency crude oil." Stored at four sites along the coast of the Gulf of Mexico, the reserve was "established primarily to reduce the impact of disruptions in supplies of petroleum products and to carry out obligations of the United States under the international energy program."
Strategic oil reserves were released on at least three occasions. The most recent release occurred in 2011 when the Obama administration sold 30 million barrels of crude oil to ease price pressure on consumers as unrest in Libya disrupted global supplies.
Granholm said the U.S. may also consider a ban on crude oil exports to address domestic supply concerns.
Energy producers have been slow to meet surging demand for petroleum products as economies recover from the COVID-19 pandemic. Prices spiked higher this week after OPEC nations declined calls to ramp up production faster than planned.