UPDATE 1-White House considers tapping oil reserves

WASHINGTON, March 6 Sun Mar 6, 2011 9:28am EST

WASHINGTON, March 6 (Reuters) - White House Chief of Staff Bill Daley said on Sunday the Obama administration is considering tapping into the U.S. strategic oil reserve as one way to help ease soaring oil prices.

Speaking on NBC television's "Meet the Press," Daley said: "We are looking at the options. The issue of the reserves is one we are considering. ... All matters have to be on the table."

There has been support among Senate Democrats for tapping the reserves. Senator Jay Rockefeller on Thursday became the third Democrat to ask President Barack Obama to tap America's emergency oil supply to cool prices that have risen past $100 a barrel on the strife in Libya.

In a letter to Obama, Rockefeller said a "limited draw-down" from the nation's 727-million-barrel Strategic Petroleum Reserve "can protect our national security by preventing or reducing the adverse impact of an oil shortage."

On Wednesday, U.S. Energy Secretary Steven Chu ruled out releasing oil from the reserve, saying ramped up oil production in Saudi Arabia should lower the crude price.

"That's going to mitigate the price increase," he told reporters on Wednesday. "We're hoping market forces will take care of this."

Treasury Secretary Timothy Geithner said on Thursday the United States and other major economies could tap strategic reserves to keep oil prices from derailing a global recovery.

Geithner said high food and oil prices were causing hardships in many parts of the world. But he said Americans were feeling less impact. (Reporting by Jackie Frank; Editing by Eric Beech)

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
Comments (19)
Amskeptic wrote:
This is insane. There has been no real supply disruption. It is commodities speculator stampeding. They love sniffing for any wisp of a story and bellow “there might be a disruption!” and therefore there is a disruption and they get rich while we all get squeezed. What happened to true supply and demand? Obama should warn the futures markets to respond to real forces, not this profit-taking chimera . . .

Mar 06, 2011 11:53am EST  --  Report as abuse
Jindy60 wrote:
Absurd approach. Temporary and ineffective.

How about tapping our reserves, the ones still underground and underwater.

Mar 06, 2011 12:05pm EST  --  Report as abuse
Kyung wrote:
The US and all of the ASEAN nations need to push hard for developing their own energy sources over the coming year and next as hard as they can. It should be a very top priority.

Mar 06, 2011 12:17pm EST  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.