Tags: Gasoline | Oil | Reserve | us

Gasoline Rally Seen Reviving US Call to Use Oil Reserve

Friday, 10 August 2012 04:43 PM

Gasoline prices in the U.S. have climbed since July 1 and now exceed levels that triggered lawmakers this year to urge the Obama administration to draw down from the Strategic Petroleum Reserve.

Regular gasoline prices at the pump, averaged nationwide, were $3.673 a gallon Thursday, according to data compiled by AAA, the nation’s largest motoring organization. The average was $3.612 on Feb. 22, when three Democratic lawmakers called on President Barack Obama to use the strategic stockpile, and was $3.287 on Feb. 24, 2011, when similar calls were made.

“We’ve seen, both this spring and last spring, as prices rose for 2011, that has prompted some calls for releases from the strategic petroleum reserve,” Avery A. Ash, Washington- based manager of regulatory affairs for AAA, said in an interview. The group backs using the reserve to deal with supply disruptions, “not to simply address rising prices,” he said.

Democratic Representatives Edward Markey of Massachusetts, Peter Welch of Vermont and Rosa DeLauro of Connecticut urged Obama to release oil from emergency inventories last year, when oil touched $103.41 a barrel, spurred by turmoil in the Middle East. The administration reacted on June 23, 2011, announcing the release of 30 million barrels in an international effort coordinated by the Paris-based International Energy Agency.

Monitoring Market

Jay Carney, the White House press secretary, said today the administration is “very closely” monitoring the oil market and “broadly” examining its options.

Obama has so far resisted calls from Markey, Welch and DeLauro this year, as gasoline peaked at $3.936 on April 4. The price slid 15 percent to $3.326 on July 1.

In response to the lawmakers’ calls, in February Energy Secretary Steven Chu said the administration was considering all options, including using the reserve, amid concerns that Iran, in retaliation for economic sanctions, might interrupt oil supplies and push prices higher.

Pump prices are increasing amid a rally in crude, tensions tied to Iran’s nuclear program and a supply disruption at Chevron Corp.’s refinery in Richmond, California, Ash said.

An Aug. 6 fire at Chevron’s Richmond plant has curbed output at Northern California’s largest facility.

‘Geopolitical Tensions’

“This is more a result of geopolitical tensions and some positive signs for the global economy, especially when looking at China,” Ash said.

Leaders of China’s ruling Communist Party last week pledged to keep adjusting policies to ensure a stable expansion this year after inflation and industrial-production growth cooled in July.

Spokesmen for Markey and DeLauro didn’t have a comment. Scott Coriell, a spokesman for Welch, said he didn’t know whether the lawmaker would renew his call.

Senator Bernie Sanders, an independent from Vermont, has been “very focused” on high gasoline prices in his state and held a hearing on the issue on Aug. 6, Michael Briggs, his spokesman, said in an interview.

Republicans and oil-industry lobbyists opposed a release from the strategic petroleum release, arguing for more oil production on federal lands and opening areas off the California and Virginia coasts to exploration.

© Copyright 2020 Bloomberg News. All rights reserved.

1Like our page
Friday, 10 August 2012 04:43 PM
Newsmax Media, Inc.
Newsmax TV Live

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

© Newsmax Media, Inc.
All Rights Reserved