Joe Biden’s Struggle With Gas Prices Isn’t Over.

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Joe Biden’s Struggle With Gas Prices Isn’t Over.

President Joe Biden’s decision to release oil from the United States’ Strategic Petroleum Reserve (SPR) is unlikely to alleviate high petrol prices at the pump.

On Tuesday, Biden approved the release of 50 million barrels of crude oil from the reserve in a joint effort with India, China, and Japan, with India alone releasing 5 million barrels from its stockpile.

Experts who talked to The Washington Newsday warned that tapping the SPR’s influence could be limited, citing energy price volatility as well as the relatively small amount of crude oil in consideration.

Given the scheduled progressive release from the SPR, the president’s action may have only a minor impact on the price of a barrel of oil.

Much will rely on how quickly the oil gets into the energy grid, according to Philip Walsh, professor of entrepreneurship and strategy at Ryerson University in Toronto and chief investigator at the university’s Center for Urban Energy.

“It’s important to be cautious about equating a small release of oil reserves with decreased gasoline prices,” Walsh warned.

“To begin with, 50 million barrels of oil is equivalent to less than three days’ worth of consumption in the United States, and the oil market is not confined to the production of gasoline. Oil-fired power generating and heating oil will compete for the surplus supplies “he stated

Gas costs, according to Walsh, are on the rise “Oil prices, which are determined by the demand-supply balance, have an impact.

“Impact in the Short-Term

“Any short-term influence on gasoline prices from the release of oil from the US Strategic Reserve will be determined by how quickly and in what daily amount the oil enters the US energy system,” Walsh added.

Companies will be allowed to submit bids for the oil until December 6, according to a statement released by the Department of Energy (DOE) on Tuesday. Contracts will be awarded no later than December 14.

“With early supplies accepted in late December,” the oil will be provided from January through April 2022.

“The overnight trade response to this news, as well as comparable announcements from other countries throughout the world,” Walsh said on Wednesday, “has resulted in higher trading prices for oil contracts.”

PumpProfessor’s prices can be found here. This is a condensed version of the information.

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