FirstFT: US looks to emergency oil reserves to tame fuel price surge

FirstFT: US looks to emergency oil reserves to tame fuel price surge

US energy secretary Jennifer Granholm has raised the prospect of releasing crude oil from the government’s strategic petroleum reserve, declaring that “all tools are on the table” as the Biden administration confronts a politically perilous surge in the price of gasoline.

With the average price of petrol at the pump hovering at $3.19 a gallon — the highest in seven years — the White House fears that the rise in fuel costs could damage its political prospects ahead of the midterm elections next year.

“It’s a tool that’s under consideration,” Granholm said of a release of crude supplies from the national strategic petroleum reserve, which analysts say could calm oil markets and bring prices down.

Granholm also did not rule out a ban on crude oil exports. “That’s a tool that we have not used, but it is a tool as well,” she told the FT Energy Transition Strategies Summit on Wednesday.

The strategic petroleum reserve, located near the Gulf of Mexico, is the world’s largest emergency stockpile of crude oil. Managed by the US Department of Energy, the reserve contained 617.8m barrels of oil last week — equal to about a month of US petroleum products demand.

The last big release was in 2011,