The Obama administration announced Thursday the answer to a question it hass been mulling for months: It will tap the Strategic Petroleum Reserve to release 30 million barrels of oil over the next 30 days.
The administration is hoping the move will lower the price of oil. While the move led to immediate declines in the short term, this move will do little to impact prices and energy security over the long term and only proves that the administration’s energy policy is a disaster. Rather than take steps to allow more domestic production, when the United States possesses tremendous energy assets, the administration is engaging in fly-by-the-seat-of-its-pants energy policy to score political points.
Indeed, amid a softening growth outlook for the U.S. economy and sagging poll numbers, the move to tap the SPR makes political sense for Obama, who is in desperate need to change the subject. But it also promises to hurt the interests of the United States, which ought to be the president’s top priority.
Earlier this month an OPEC meeting failed to produce an agreement about proposed oil output increases, but that shouldn’t have been a factor in the decision to tap into the SPR. Oil-rich Middle Eastern nations can and very likely will up their oil output; doing so would be to their benefit because it means avoiding large oil-price surges.
The SPR is our country’s first line of defense in the event of oil supply disruption, not an ATM machine that the president can draw from when he needs to boost his poor approval ratings. It seems the president’s willingness to play politics with a security asset has more to do with his quest for a second term than any desire to see Americans pay less to gas up.
Rather than draw down on these limited reserves, Obama ought to speed up the red-tape-entangled permitting process for offshore drilling projects at home and increase lease sales to domestic reserves. In fact, if the president truly valued the American consumer and domestic energy security, he would never have enacted his job-crushing, energy-killing drilling moratorium in the Gulf last year – followed by a refusal to grant permits
According to the House Natural Resources Committee, the ban cost us 900,000 barrels of domestically produced oil every day – a total of about 135 million barrels, more than four times the amount the president is now sacrificing a security asset in order to tap. In this case it’s Obama’s Gulf ‘permitorium’ that constituted the real supply disruption.
There is at least one bright spot with this news from the White House: it seems that President Obama finally realizes that increased supply will bring down prices. But if President Obama really wants to see long-term energy prices decline, he must allow American energy workers to develop our billions of barrels of oil both onshore and offshore.
Thomas J. Pyle is president of the Institute for Energy Research.