As rising gas prices strain the budgets of many Americans, President Joe Biden is set to announce on Wednesday moves that aim to address the oil supply shortage behind the cost spike.
Most notably, the announcement includes the release of 15 million barrels of oil from the nation’s stockpile — known as the Strategic Petroleum Reserve — in December.
The release accounts for the final 15 million barrels of oil from the 180 million that Biden vowed to release over six months.
The move renews questions about why the U.S. stockpiles oil, how much oil the reserve has left and if more oil on the market can bring down gas prices.
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Here’s everything you need to know about the SPR:
What is the U.S. Strategic Petroleum Reserve?
Established after the Arab Oil Embargo triggered an energy crisis in the early 1970s, the SPR provides an emergency source of oil that protects the U.S. against a sudden supply crunch.
The reserve, which can reach as many as 714 million barrels, is stored in large, high-security underground salt caverns along the gulf coastlines of Louisiana and Texas. As of Oct. 7, the reserve stood at 408 million barrels or 57% of overall capacity, according to the Energy Information Administration.
The president retains wide discretion to release oil from the reserve in what he deems an emergency. In such cases, the U.S. sells the oil on the open market, which in theory should bring oil prices down by increasing supply.