President Joe Biden announced Tuesday that the U.S. government will tap into its Strategic Petroleum Reserve (SPR) as part of a global effort to help slow rapidly rising oil prices.
The plan has been coordinated with India, China, Japan, the Republic of Korea, and the United Kingdom and is the first of its kind. In all, 50 million barrels of crude oil will be released from the SPR.
“The President stands ready to take additional action, if needed, and is prepared to use his full authorities working in coordination with the rest of the world to maintain adequate supply as we exit the pandemic,” the White House said in a statement.
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The administration has been saying for months that it was looking into the tools at its disposal to calm the oil market. The national average for a gallon of gas was $3.409 on Monday, up from $2.11 a year ago, reports CNBC.
At the height of the lockdown, oil prices fell precipitously. OPEC oil producers have been deliberately limiting production in order to avoid another contraction, despite requests from the White House to boost output.
Since then, though, demand has skyrocketed and crude oil prices recently touched a seven-year high, reports the BBC. That has led to high fuel prices for consumers in the U.S. and in other countries.
Although some experts have questioned how much of an impact the move will have on consumers, it is considered a first step to show OPEC members that the U.S. and other nations will take serious action to address energy prices.
“We will continue talking to international partners on this issue,” a senior US administration official told reporters. “The president stands ready to take additional action if needed, and is prepared to use his full authorities working in coordination with the rest of the world.”
