Biden to announce release of oil in bid to curb gas prices

President Biden is expected to authorize the release of more oil from the Strategic Petroleum Reserve in December an effort to bring down gas prices, senior administration officials announced Tuesday.

Why it matters: The move comes ahead of the midterm elections and during a campaign season in which elevated pump prices — while far lower than their June peak — likely pose political jeopardy for Democrats.

What we’re watching: The administration is calling on the Department of Energy to be ready to move forward with additional significant SPR sales this winter if needed due to Russian or other actions disrupting global markets.

Driving the news: 15 million barrels will be released in December as part of the 180 million barrels the administration had announced earlier this year, according to the officials.

• Officials confirmed they may release “significant” additional barrels this winter beyond the December barrel tranche of the 180-million barrels announced in March.
• This would occur “if needed due to Russian or other actions disrupting global markets,” a White House summary states.

The intrigue: Biden will also announce that the administration intends to repurchase crude oil for the SPR when prices are at or below about $67-$72 per barrel.

• Officials told reporters this will help spur more domestic production by providing oil companies certainty about future demand even at prices that are more modest than today’s levels.

The big picture: The planned December release, and the prospect of even further releases this winter, is the latest of several attempts by the Biden administration to try and tame gas prices via the SPR.

• Current U.S. average gasoline prices are $3.87 per gallon, which is far below the peak of $5 per gallon in June. But gasoline prices, a driver of wider inflation, are still up overall this year.

Catch up fast: The administration’s announcement arrives roughly two weeks after OPEC+ announced it would ease output by 2 million barrels per day (though the real-world amount will be smaller).

• The coalition’s move angered the White House, which had appealed to Saudi Arabia — OPEC’s dominant producer — not to slash output. The White House says it’s now reevaluating its relationship with the kingdom.
• Crude oil prices — the biggest factor in pump prices — have fallen back significantly after jumping around the OPEC+ move.
• Gloomy economic signs have cooled the market, but prices remain volatile amid Russia’s war on Ukraine.

Editor’s note: This is a breaking news story. Please check back for updates.