Lawmakers announce legislation to fund government purchases of oil

Lawmakers announce legislation to fund government purchases of oil
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A group of lawmakers announced Tuesday that they are introducing legislation that aims to fund a government purchase of oil, boosting an industry that has been hit by reduced demand and international disputes. 

The legislation would give the Energy Department $3 billion with which to purchase oil to be stored in the Strategic Petroleum Reserve (SPR), a move that the Trump administration has also pushed for. 

It is being introduced in the Senate by Sen. John HoevenJohn Henry HoevenBipartisan senators seek funding for pork producers forced to euthanize livestock House Republicans threaten pushback on Saudi Arabia amid oil market slump Overnight Energy: Trump rollback of Obama mileage standards faces court challenges | Court strikes down EPA suspension of Obama greenhouse gas rule | Trump floats cutting domestic oil production MORE (R-N.D.) and in the House by Reps. Lizzie Fletcher (D-Texas) and Michael BurgessMichael Clifton BurgessThe Hill's Coronavirus Report: Moniz says U.S. needs energy jobs coalition and Manchin says Congress is pushing Wall Street solutions that don't work for Main Street; Burr to step aside The Hill's 12:30 Report: House returns to DC for coronavirus relief House leaders enact new safety precautions for votes MORE (R-Texas). 

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The bill has the backing of Republican Sens. John CornynJohn CornynGOP senators urge Trump not to restrict guest worker visas Castro, Warren, Harris to speak at Texas Democratic virtual convention Democratic unity starts to crack in coronavirus liability reform fight MORE (Texas), Kevin CramerKevin John CramerTrump tries to soothe anxious GOP senators Trump cites 'Obamagate' in urging GOP to get 'tough' on Democrats Obama tweets 'vote' after Trump promotes 'Obamagate' MORE (N.D.), Ted CruzRafael (Ted) Edward CruzGOP deeply divided over Trump's social media crackdown Hillicon Valley: Twitter flags Trump tweet for 'glorifying violence' | Cruz calls for criminal investigation into Twitter over alleged sanctions violations | Senators urge FTC to investigate TikTok child privacy issues Cruz calls for criminal investigation into Twitter over alleged Iranian sanction violations MORE (Texas), Lisa MurkowskiLisa Ann MurkowskiOVERNIGHT ENERGY: Trump administration gives renewables more time to take advantage of tax credits | House Republicans introduce bill to speed mining projects for critical minerals | Watchdog faults EPA communications in contamination of NC river Trump administration gives renewables more time to take advantage of tax credits GOP senators urge Trump not to restrict guest worker visas MORE (Alaska) and Dan SullivanDaniel Scott SullivanGOP senators urge Trump not to restrict guest worker visas Energy secretary accuses banks of 'redlining' oil and gas industry Postal Service to review package fee policy: report MORE (Alaska), as well as Reps. Kelly Armstrong (R-N.D.) and Henry Cuellar (D-Texas). 

“Purchasing U.S. oil for the SPR will not only benefit our energy producers, but also taxpayers and our national security. This legislation, along with our efforts to stop the global price war, are part of our work to support our domestic energy producers and provide stability to global energy markets,” Hoeven said in a statement. 

It comes after Congress declined to provide funding in the third coronavirus stimulus package for the purchase of 30 million barrels of oil. The Energy Department at the time withdrew a solicitation to purchase the oil and has since said it will rent space in the SPR to oil producers

There have also been some calls to include funding for an SPR purchase in the next coronavirus stimulus package. 

“Unfortunately, these funds were held hostage during Phase Three negotiations,” Cramer said in a statement. “Congress should play its part and include this funding in Phase Four.”

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Even though the legislation is supported by some House Democrats, it would likely face an uphill battle in the lower chamber. 

Democrats and environmentalists have repeatedly condemned the possibility of a government purchase of oil as a bailout for an industry that contributes to climate change. 

President TrumpDonald John TrumpDonald Trump and Joe Biden create different narratives for the election The hollowing out of the CDC Poll: Biden widens lead over Trump to 10 points MORE, meanwhile, has endorsed an SPR purchase, saying he wants to “fill it right up to the top.”

As the market is flooded amid a production standoff involving Saudi Arabia and Russia and decreasing demand linked to the coronavirus, Trump has also floated other actions including tariffs on oil imports and decreasing domestic production.