The US releases 10 million more barrels of oil after OPEC reduces production

A OPEC announcement that it will drastically reduce oil production on Oct. 5 led the Biden administration to release 10 million additional barrels of oil from the Strategic Petroleum Reserve.

OPEC announced it would reduce oil production by 2 million barrels per day hours before the decision was announced. As U.S. gas prices rise, a cut in production marks a setback for Biden, who visited Saudi Arabia in July to pressure the kingdom into taking action.

Oil and gas prices are expected to rise worldwide as a result of reduced production. Since OPEC fell about 3.6 million barrels short of its August production target, the cuts would be less deep because OPEC's production cuts are based on existing baseline figures.

In order to protect American consumers and promote energy security, the President will continue to direct releases from the Strategic Petroleum Reserve as needed. In the immediate term, he has directed the Secretary of Energy to explore any additional responsible measures to increase domestic production."

White House officials announced Oct. 5 that the plan had been scrapped. In the statement, Jake Sullivan and Brian Deese said, per a directive by Biden, "The Department of Energy will deliver another 10 million barrels from the Strategic Petroleum Reserve to the market next month."

6 October 2022