Administration leaves door open to releasing more oil

The Obama administration left the door open Thursday to releasing more oil from the country's strategic stockpiles.

“At the end of the first 30 days of action by the IEA members, we will review the results,” a senior administration official told reporters. “The U.S. stands ready to do more if necessary to address this issue.”

The administration announced Thursday that it is releasing 30 million barrels of oil from the Strategic Petroleum Reserve (SPR) over the next 30 days. The U.S. is working in conjunction with International Energy Agency member countries, which will release an additional 30 million barrels.

The administration is offering no predictions about the effect of its decision on the price of gas.

“We’re not making predictions about market prices, which go up and down,” the official said. “This is about addressing the supply disruption and the prices will be what they are.”

Crude oil prices fell Thursday.

It is only the second time that a president has tapped the SPR since it was established after the oil embargo of the 1970s. The reserve is intended to be used in the event of a major supply disruption.

As gas prices began soaring in recent months, President Obama directed key officials to work with the governments of major oil exporting and consuming countries to come up with a plan to address supply shortages from Libya, the official said.

Unrest in Libya has removed 1.5 million barrels of oil per day from world markets, the Energy Department says.

“The president has been deeply concerned about the impact of the disruption of oil production from Libya and other countries in the Middle East have had on energy supplies globally, the tightness that — that’s created in the markets and the effects of that tightness on global economic growth,” the senior administration official said.

The White House says the decision to release the reserves is being done in “full consultation” with major oil producing countries.

“It’s intended to complement the efforts of many of those countries,” the official said.

The average price for a gallon of gas in the United States peaked at just under $4 this spring. But the price has gone down in recent weeks. Thursday’s average price was $3.61 per gallon, according to AAA.

Pressed by reporters about why the administration chose to release the reserves now, when gas prices are going down, the official would only say that the administration has been working on the plan for months.

“This is something that has been in the works for a while,” the official said.

Republicans quickly blasted Obama’s decision to release oil from the SPR Thursday, arguing it is intended to score political points.

“Frankly, it's pathetic that Democrats not only block domestic energy production at every turn, President Obama is now drawing down on our nation’s ‘strategic’ oil reserve which is intended for national emergencies, not as a political tool when a President is feeling heat over high gas prices,” said House Majority Whip Kevin McCarthy (R-Calif.) in a statement.