Biden to release 50m barrels of oil from strategic reserve to address high gas prices
Joe Biden announced this morning that his administration will release 50m barrels of oil from the strategic petroleum reserve to help address high gas prices.
The president said on Twitter that the action “will be taken in parallel with other major energy consuming nations including China, India, Japan, Republic of Korea and the United Kingdom”.
The news comes as gas prices have increased by 49.6% over the past year, bringing the national average for a gallon of gas to $3.40, per AAA.
“As we come out of an unprecedented global economic shutdown, oil supply has not kept up with demand, forcing working families and businesses to pay the price,” energy secretary Jennifer Granholm said in a statement.
“This action underscores the President’s commitment to using the tools available to bring down costs for working families and to continue our economic recovery.”
Read more about the announcement here:
Joe Biden has argued that Democrats’ $1.75tn social spending package, which passed the House on Friday, will help families struggling with higher prices by lowering the costs of healthcare and childcare.
However, there are lingering concerns about how the high rate of inflation may impact the negotiations over the bill in the evenly divided Senate.
Senator Joe Manchin, one of the key holdouts in Democrats’ negotiations over the bill, has said he is hearing more from constituents who are concerned about their gas and grocery bills.
“By all accounts, the threat posed by record inflation to the American people is not ‘transitory’ and is instead getting worse,” Manchin said earlier this month. “From the grocery store to the gas pump, Americans know the inflation tax is real and DC can no longer ignore the economic pain Americans feel every day.”
Manchin has previously expressed concern that Democrats’ spending package, known as the Build Back Better Act, could negatively contribute to inflation.
In a September op-ed for the Wall Street Journal, Manchin warned against approving more government spending, saying, “An overheating economy has imposed a costly ‘inflation tax’ on every middle- and working-class American.”
However, since that op-ed was written, the cost of the package has been cut in half — from $3.5tn to $1.75tn. And a number of economists have said the bill will not add to inflationary pressure.
Biden is hoping those arguments will be enough to make Manchin a “yes” vote, as he will need all 50 Democratic senators’ support to get the bill through the upper chamber.
Joe Biden’s nominees for the Federal Reserve board have also pledged to tackle inflation aggressively if they are confirmed by the Senate.
Jerome Powell, who has been nominated to a second term as the chair of the Fed board, said yesterday, “We know that high inflation takes a toll on families, especially those less able to meet the higher costs of essentials, like food, housing and transportation.”
Powell, who was first nominated by Donald Trump, said he would use the tools of the central bank “to prevent higher inflation from becoming entrenched”.
Dr Lael Brainard, Biden’s nominee for vice-chair of the board, echoed that message, saying, “I’m committed to putting working Americans at the center of my work at the Federal Reserve. This means getting inflation down at a time when people are focused on their jobs and how far their paychecks will go.”
Biden to address lowering prices as inflation hits 31-year high
Greetings, live blog readers.
Joe Biden will deliver a speech this afternoon on the state of the US economy and the need to lower prices for American families.
The president’s speech comes as inflation has hit a 31-year high, with prices increasing by 6.2% over the past 12 months. That’s the fastest acceleration since December 1990.
And Americans are growing more concerned about high prices as they continue to rise. According to a poll conducted by the progressive firm Navigator Research earlier this month, 54% of Americans now say the cost of groceries and gas is a “major crisis”.
Biden has pledged to tackle the issue, arguing that Democrats’ $1.75tn social spending package will lower families’ costs for healthcare and childcare.
Speaking at an event yesterday to announce his nominations for the Federal Reserve board, Biden said, “Because so much of the rest of our economy is doing well, because we have created so many new jobs as fast as we have, we’re in a position to attack inflation from a position of strength, not weakness.”
But if Americans don’t start to see prices come down soon, it could make it all the more difficult to enact Biden’s agenda.
The blog will have more coming up, so stay tuned.