Energy Secretary Opposes GOP Push to Add Conditions for Withdrawing More Oil From National Reserves

U.S. Secretary of Energy Jennifer Granholm speaks during a briefing about the bipartisan infrastructure law at the White House, on May 16, 2022. Elizabeth Frantz/Reuters

U.S. Secretary of Energy Jennifer Granholm sent a letter to the House energy panel warning that the GOP push to add stipulations to the withdrawal of oil from strategic reserves will harm Americans and contribute to an increase in gas prices.

Earlier this month, Rep. Cathy McMorris Rodgers (R-Wash.) introduced the Strategic Production Response Act that will make President Joe Biden’s authority on releasing oil from the Strategic Petroleum Reserve (SPR) conditional on the president opening up more federal lands for oil and gas drilling. House Republicans are set to soon vote on it. Rodgers chairs the House Energy and Commerce Committee.

“This bill would significantly weaken this critical energy security tool, resulting in more oil supply shortages in times of crisis and higher gasoline prices for Americans,” Granholm said in the letter to the committee, according to Reuters. In an email to the outlet, Rodgers said that the committee is reviewing the letter.

Granholm also cited estimates from the Department of the Treasury which claim that the Biden administration’s use of the SPR led to a reduction in U.S. gas prices by $0.17–0.42 per gallon.

U.S. retail gas prices jumped from $3.701 per gallon in the week ended Feb. 28, 2022, to a peak of $5.107 per gallon in the week ended June 13. Biden’s release of 180 million barrels from the SPR began in March. As of Jan. 9, 2023, gasoline prices averaged $3.366 per gallon.

Even though gas prices have fallen since the June peak, they still are up by more than 35 percent compared to the $2.478 per gallon price in late January 2021.

The administration’s policies have been blamed for elevated gas prices. For instance, Biden canceled the Keystone Pipeline project that was revived by former president Donald Trump. The project was expected to carry 800,000 barrels of oil per day into the United States.

Biden has issued the fewest acres of land for federal oil and gas leasing since the late 1940s. In June last year, the Interior Department announced a plan which gave the agency an option to not issue any new leases until the end of 2028.

And in April 2022, the Environmental Protection Agency (EPA) decided to rescind exemptions which allowed more than 30 refiners to avoid blending renewable biofuels into gasoline and diesel. This is said to have contributed to a hike in costs for refineries and reduced output.

Low SPR Stockpile, Blocking SPR Sales to China

Biden’s release of SPR reserves has been heavily criticized by Republicans, who argue that more needs to be done to boost domestic drilling. The Biden administration insists that its policies toward oil and gas lease are a long-term issue while supply disruption requires a short-term solution.

Since 2000, the SPR has usually remained above 600 million barrels. However, the Biden administration’s SPR release has depleted it to below 400 million barrels by the end of last year, which is the lowest level since the 1980s.

To protect the SPR stockpile, Rodgers also introduced the “Protecting America’s Strategic Petroleum Reserve (SPR) from China Act.” It was passed by the House of Representatives by a margin of 331–97 on Jan. 12.

The bill prohibits the sale of SPR oil to any entity that is under the control, influence, or ownership of the Chinese Communist Party.

“It should not have to be stated: we simply should not allow our oil to be exported to the Chinese Communist Party. A strong energy sector is a strong national defense, and we cannot let this administration drain our SPR to record lows by selling barrels to one of our nation’s adversaries,” Rep. Dan Newhouse (R-Wash.), who co-sponsored the bill in the House, said in a press release on Jan. 12.

Government Opposition

The “Protecting America’s Strategic Petroleum Reserve (SPR) from China Act” had received large support from Democrats, with more than half of the House Democratic Caucus voting for it.

However, the Biden administration has opposed it, with White House spokesperson Andrew Bates calling it a “backwards” move and an attempt by the GOP to raise gas prices so as to make the president look bad.

In an interview with NTD, Rep. Gary Palmer (R-Ala.) dismissed such accusations.

“It’s another example of how little he [Biden] knows about economics and market principles,” Palmer said. “When you’re sending your crude oil to another country where it’s going to be refined and consumed there and it’s not coming back here, it reduces the market supply, which increases price.”