During the March 1 State of the Union Address, President Biden announced the U.S. would be releasing 30 million barrels of crude oil in an effort to curb rising gas prices.
As an act of condemnation towards Russia's ongoing invasion of Ukraine, many oil companies such as BP, Shell and Exxon Mobil have reportedly condemned Russia by refusing to do business in the country. As Russia is the world's highest oil exporter with 5 million barrels exported per day, this boycott of Russian oil has had negative effects on the supply chain, necessitating the decision to release the oil reserves. The market stands to remain in short supply for months to come.
"Tonight, I can announce the U.S. has worked with 30 other countries to release 60 million barrels of oil from reserves around the world. America will lead that effort, releasing 30 million barrels from our own Strategic Petroleum Reserve. And we stand ready to do more if necessary, unified with our allies," said President Biden during the address. "These steps will help blunt gas prices here at home. But I know news about what’s happening can seem alarming to all Americans. But I want you to know: We’re going to be okay."
The Strategic Petroleum Reserve is a complex of four sites with deep underground storage caverns created in salt domes along the Texas and Louisiana gulf coastline. Owned by the U.S. government and holding the largest supply of emergency crude oil, the SPR was established to reduce the impact of disruptions in supplies of petroleum products.
The American Automobile Association reports the national average for a gallon of gas to be $3.66 per gallon and predicts the price will keep rising. According to a Reuters report, crude oil prices topped $110 per barrel March 3.
