Obama taps Strategic Petroleum Reserve
The White House releases 30 million barrels of oil from America's petroleum reserves -- the impact on fuel consumption and economic growth.
Story by Mitra Taj, Living on Earth. Use audio player above to listen to this report.
The war in Libya has disrupted the world's supply of oil, so the 28 member nations of the International Energy Agency are opening the taps on their strategic petroleum reserves. The U.S., which began stockpiling oil in 1975, will provide half of the 60 million barrels the Agency plans to sell.
If you're wondering what tapping the Strategic Petroleum Reserve might mean for efforts to cut America's addiction to foreign oil, Michael Levi, an energy analyst with the Council on Foreign Relations, has an answer.
"It's irrelevant," says Levi. "This is a short-term response to a short-term problem and is an independent issue from long-term transformation of the U.S. economy and U.S. energy consumption."
White House officials say the long-term plan remains the same: energy efficiency, alternative fuels and electric cars, and boosting domestic oil production. In time those policies might help keep volatile global oil markets from squeezing the economy. But the short-term impact of the decision is hard to ignore: just after it was announced, the price of oil fell five dollars to $90 dollars a barrel.
Joseph Romm, a climate blogger and former Department of Energy official, says this won't last: "This is perhaps going to, you know, puncture a modest bubble, but the price of oil is headed up over time because we're seeing peak production around the world. Personally, I think we should sell off most of this oil and use the money to help make the transition to clean energy."
It seems unlikely Republicans would support doing that with the $2.5 billion dollars that's expected to be raised from the reserves. They've called the decision a distraction from their push to drill more oil here at home. But if an injection of oil can stimulate economic growth, the White House might face less political pressure and have more room to pursue a clean energy agenda.
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