By Andrew Restuccia - 03/18/12 11:30 PM EDT
Republicans launched a preemptive strike last week against rumored plans by the White House to tap the country’s emergency oil reserves.
Releasing oil from the Strategic Petroleum Reserve, a 696-million-barrel stockpile stored on the Gulf Coast, is a ploy to score political points amid gas prices that are nearing a national average of $4 per gallon, Republicans argued.
“Instead of manipulating the SPR, the White House should approve the Keystone XL pipeline, increase domestic energy exploration, cut red tape, and stop the EPA from shutting down American refineries.”
Barrasso highlighted a Feb. 28 memo from the Senate Republican Policy Committee outlining the GOP’s objections to an SPR release.
“Releasing oil from the SPR would be, at best, a short-term benefit, while continuing to neglect the long-term policies that could prevent true supply disruptions and price spikes in the future,” the memo says.
Republicans revived their long-time objections to releasing SPR oil this week after Reuters reported that British and U.S. officials informally agreed to jointly tap their emergency stockpiles. The news agency also reported that President Obama and British Prime Minister David Cameron discussed the issue during a meeting at the White House on Wednesday.
The White House aggressively pushed back on the reported deal Thursday.
"It is inaccurate, as was reported today, that any kind of agreement was reached on a course of action," White House Press Secretary Jay Carney said during his daily briefing. "Those reports are wrong. They’re false."
Carney said Obama and Cameron talked about energy and oil issues during their meeting Wednesday, but he offered no specific details about the discussion.
White House and administration officials have consistently said tapping the SPR is on the table, feeding speculation that the president will approve a release if tensions with Iran reach a fever pitch or if gas prices continue to increase.
Some Democrats and liberal groups have been pushing Obama for weeks to tap the SPR, pointing to Iran’s threats to cut off oil exports and block a key oil shipping route.
Reps. Edward MarkeyEd MarkeyOvernight Finance: Lawmakers float criminal charges for Wells Fargo chief | Scrutiny on Trump's Cuba dealings | Ryan warns of recession if no tax reform Overnight Tech: FCC chief downplays delay to TV box reforms | Lawsuit filed over internet transition | Waze rolls out ridehailing service Anti-trade senators say chamber would be crazy to pass TPP MORE (D-Mass.), Rosa DeLauro (D-Conn.) and Peter WelchPeter WelchRetailers have jumped the shark EpiPen investigation shows need for greater pricing transparency, other reforms Dem lawmakers: Clinton should have disclosed illness sooner MORE (D-Vt.) are circulating a letter urging Obama to quickly tap the SPR. The number of lawmakers signing on to the letter will be a political barometer of whether support for releasing the oil is spreading beyond a handful of liberal Democrats.
“We are writing you because we believe that it is essential that the United States have an aggressive strategy for releasing oil from the Strategic Petroleum Reserve to combat the speculators capitalizing on the fear in oil markets and to send a message to Iran that we are ready, willing and able to deploy our oil reserves,” the letter says.
Obama released 30 million barrels of oil from the SPR last summer in order to make up for supply losses from Libya. At the time, administration officials said the supply losses were threatening the economic recovery. The president tapped the SPR in conjunction with International Energy Agency nations.
The White House is growing increasingly concerned about the effect that high gas prices — which reached an average of $3.83 per gallon nationally on Friday — could have on Obama’s reelection bid. Recent polls show that the public disapproves of the way Obama is handling soaring pump prices.
In response, the White House has launched a full-court press to undercut Republican efforts to blame Obama’s energy policies for the high prices. The president has made four high-profile energy speeches during the last month and he will travel to Nevada, New Mexico, Oklahoma and Ohio on Wednesday and Thursday to continue touting his energy plan.
Obama has stressed that there are no quick-fixes to high gas prices, while also reassuring the public that he is doing everything within his power to give consumers relief. He has highlighted the administration’s “all-of-the-above” energy plan, which includes expanded domestic oil production, improved vehicle fuel efficiency and increased investments in renewable energy.
It remains unclear whether tapping the SPR will be a part of Obama’s energy strategy. But Republicans are nonetheless preparing their counter-offensive.
A Senate GOP aide says Republicans will likely argue that releasing oil from the SPR is an acknowledgment by the president that “supply matters.” Republicans would then counter that if the president wants increased supply, he should expand domestic production and approve the Keystone XL oil pipeline.
But Mark Mellman, president of the Mellman Group and a Democratic strategist, said Republicans may find it difficult to successfully criticize Obama for releasing oil from the SPR.
“If the Republicans want to attack lowering gas prices, that puts them in a pretty strange position frankly,” he said, noting that expanded development likely won’t bring new supplies online for years.
Mellman said Obama will benefit politically from tapping the SPR if the move causes gas prices to drop.
“There’s some political benefit to lowering gas prices,” he said. “There’s some political benefit to being seen as concerned about gas prices.”
Federal policymakers have few options to lower gas prices in the short term, according to energy analysts. Gas prices are tethered to oil prices, which are set by global markets based on a slew of complicated factors.
But experts say releasing oil from the SPR, if it’s done in conjunction with other countries, could lower gas prices, at least temporarily.
“When the SPR is used, it tends to have a short-term impact,” Richard Newell, the former administrator of the Energy Information Administration, told The Hill earlier this month.
But Newell warned that oil should be released from the SPR only if there are major supply disruptions.
“I don’t think we’re currently in that situation,” Newell said, adding that policymakers are likely watching the increasingly tense situation in Iran.