Obama tapping US oil reserves

By Matthew Daly
Associated Press / June 24, 2011

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WASHINGTON — Wary of a new surge in gas prices, the Obama administration said yesterday it is selling off 30 million barrels of oil from the country’s emergency reserves as part of a broader international response to lost oil supplies caused by turmoil in the Middle East and North Africa, particularly Libya.

The release from the US Strategic Petroleum Reserve will be the largest ever, amounting to half of a 60 million-barrel international infusion of oil planned for the world market over the next month.

Even so, the 30 million barrels to be sold by the United States represent less than two days’ worth of domestic oil consumption and about three days of oil imports.

White House officials would not predict how the release will affect prices at the pump, although the move is intended to increase supplies during the peak summer driving season.

“We are taking this action in response to the ongoing loss of crude oil due to supply disruptions in Libya and other countries and their impact on the global economic recovery,’’ Energy Secretary Steven Chu said.

The move comes as retail gasoline prices dropped for the 20th consecutive day, down a penny from Wednesday, to $3.61 per gallon, according to the AAA Daily Fuel Gauge Report. That is about 21 cents lower than a month ago.

The timing brought criticism from business groups and Republican lawmakers, who accused Obama of playing politics with the country’s oil reserves, which are intended to address emergencies.

House Speaker John Boehner, Republican of Ohio, said the administration’s action will do little to benefit consumers while leaving the nation vulnerable to hurricanes or other natural disasters, or a foreign crisis that causes a real supply shortage.

“By tapping the Strategic Petroleum Reserve, the president is using a national security instrument to address his domestic political problems,’’ Boehner said.

Representative Edward J. Markey, Democrat of Malden, called the GOP criticism off the mark, saying that 30 million barrels is less than 5 percent of the 727 million barrels in reserve.

“With our economy teetering on the brink of a double-dip recession, and American families still struggling during peak driving season, this is the one tool America has at her disposal to immediately help drive down prices at the pump,’’ said Markey.