President Joe Biden on November 23 announced that he has ordered the release of 50 million barrels of oil from the US strategic reserves in a coordinated attempt with other countries to tamp down soaring fuel prices.
“This release will be taken in parallel with other major energy consuming nations including China, India, Japan, Republic of Korea and the United Kingdom,” the White House said.
A senior administration official told reporters this was “the first time we’ve done something like this in parallel with other” countries.
As the world emerges from the Covid-19 pandemic and subsequent lockdowns, oil production has not kept pace with rocketing demand, pushing prices up.
In the US, an associated rise in petrol prices is one of the main culprits in a surge of inflation.
Biden’s announcement comes as people across the US prepare for the holiday season, when travel ramps up.
Average fuel prices at filling stations are $3.41 a gallon ($0.75 a litre), the highest level since 2014, according to latest figures from the AAA motorists’ association. This represents an increase of $1.29 over petrol prices a year ago.
The US reserves, held in underground depots in the states of Texas and Louisiana, are the largest emergency supply of oil in the world.
A senior administration official said the releases would start in mid- to late December, and that further intervention was possible to steady the market, “responding to a once-in-a-century pandemic”.