Energy Department Turns Ordinary Gasoline Sale Into Major Announcement
On Tuesday, the U.S. Department of Energy (DOE) announced that it would sell 1 million barrels of gasoline, equaling 42 million gallons, from the Strategic Petroleum Reserve (SPR) ahead of July 4. A DOE press release said the sale would largely impact “the states of Maine, New Hampshire, Vermont, Massachusetts, Connecticut, Rhode Island, New York, New Jersey, and Pennsylvania.”
“The Biden-Harris Administration continues to take strategic action to lower prices for American consumers in every aspect of their lives—especially as summer driving season ramps up,” said DOE Secretary Jennifer Granholm. “By releasing this reserve ahead of July 4th, we are ensuring sufficient supply flows to the Northeast at a time hardworking Americans need it the most.”
But the sale was not some magnanimous gesture—in fact, it was required by law. And it’s hard to see how the act will make much of a difference, unless the goal is to shore up President Joe Biden’s flailing reelection bid.
Section 308 of the 2024 Consolidated Appropriations Act mandated that “the Secretary of Energy shall draw down and sell one million barrels of refined petroleum product from the Strategic Petroleum Reserve during fiscal year 2024” and then “carry out the closure of the Northeast Gasoline Supply Reserve.” For the DOE to brag about this sale, “the administration is claiming credit for a policy enacted by Congress,” says Peter Van Doren, senior fellow at the Cato Institute.
The Northeast Gasoline Supply Reserve was established in 2014. After Hurricane Sandy caused damage to refiners in 2012, leading to fuel shortages across New York, DOE then-Secretary Ernest Moniz authorized the department to set aside 1 million barrels of gas for future emergencies. (The SPR was itself created in 1975 to hold crude oil, after that decade’s oil embargoes, to provide a backstop against future supply shocks.)
But “storing refined fuel is costlier than storing crude oil,” Reuters noted in May, so Congress shuttered the reserve in its 2024 spending bill.
Not only is the sale a requirement under federal law, but 1 million barrels of gas will just be a literal drop in the bucket.
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