Why DON'T WE Tap The Strategic Petroleum Reserve?

I just paid $4.55/gallon for heating oil-isn’t it time?
Why not?

Because the Government doesn’t care how much we are spending per gallon as long as there are enough gallons to go around? Higher prices are not necessarily a sign of a shortage that woudl require federal intervention.

Because cheap petroleum isn’t the God-given birthright of every American. Petroleum is a commodity product and it’s price is driven by global supply and demand. The government can’t wave a magic wand to drive down prices. The methods used to drive down prices all have disastrous secondary effects. Do you want to pay higher taxes for the privilege of paying lower fuel prices? Or how about, the people who buy fuel pay for their own damn fuel, and stop expecting Uncle Sugar to subsidize them?

Isn’t the point of a reserve to serve as a reserve?

I don’t think making sure my vacation is a cheap as possible is one the strategic goals of the US. Making sure the infrastructure of the nation continues to function, maybe. Making sure my V8 SUV is fully air conditioned to a comfortable temperature, sadly no.

Because the purpose of the reserve is not to buffer against minor price fluctuations. It’s to be used strategically when the outcome matters in a substantial way.

I moved closer to work six months ago and walked to work today because the price of gas is going up.

How about you consider tapping into a strategic sweater reserve?

Yes and no. It’s a reserve, but it’s not meant never to be taped. However, the purpose of the SPR is to help during a severe disruption in the flow of oil, not to modulate the price of the product in the absence of a real shortage.

We’d then need to replace that reserve, and pay a premium for doing so.

Because, as Daniel Yergin says, doing so wouldn’t do anything to address the underlying cause of the recent price escalation, the unrest in North Africa and the Middle East. That and it’s not meant as a hedge against unpalatable prices but instead a resource for strategic use during periods of prolonged supply disruption.

Why not investigate other methods of home heating?

Because there isn’t an oil shortage.

The Saudis are supposedly pumping more oil to calm the markets but I’m not seeing anything coming from them politically to help calm the oil speculation. Nor am I hearing anything from the other big oil producers in the Middle East like Kuwait or the UAE.

That’s okay, when the US economy goes back into the shitter, they can help bail us out, right?

With friends like these…

Because all parties in the government think that the oil corporations should be allowed to gouge everyone without market interventions. I think we should tap it. In short, I’m agreeing with Ralph. Can Armageddon be far behind?

If the oil companies were out to gouge you, why did they wait until now? If they’re conspiring to jack up prices to $4.50 a gallon, why weren’t prices always $4.50 a gallon? Why were they giving you a break last year?

Isn’t it pretty much the consensus of anyone with a long-term view of social health, that the price of oil is currently too low?

Next up: why DON’T WE dig ditches with tactical nukes?

Yeah! Every time they jack the price up, I feel healthier. They should keep jacking the price up until I’m immortal!

Just because it’s there doesn’t mean we should use it, just because it’s there. Its for when the US is eventually in dire straits.

People have to put gas in their cars, and it costs a lot, but they have to learn how to manage to do it. I don’t understand why this is hard to grasp. I have a friend living in her McMansion down the road, she has a good job, but she still buys mochachinos at Starbucks, she just bought $100 worth of makeup at Sephora, $20 bottles of shampoo, goes out to lunch every single day (and not at a fast food joint)…on and on. Because she ‘deserves’ the very best. And then she bitches endlessly about the price of gas. She’s still living and spending like she did 5-10 years ago. She just doesn’t GET it.

It’s hard to grasp for two reasons:

  1. People have a hard time understanding the concept of an actual shortage.

  2. People have a hard time seeing an asset just sitting there, doing nothing; it goes against their investment/leveraging/just-in-time instincts. They don’t get that someone won’t just loan them more oil if they ever run out.

Use the strategic reserve now and you’re really going to kick yourself when protests in Saudi Arabia disrupt production there to the tune of 4 million bbl/day for two weeks and the reserve is empty.

I certainly don’t agree with releasing oil from the reserve now (in fact we should keep injecting), but it isn’t true to say it has only been used in the past in emergency situations.

Three times during 1996 the administration and congress authorized non-emergency sales.

I for one am pretty sure the reserve was never intended to help out the general population, but is there for the use of government should real and lasting shortages develop. That’s my uneducated guess anyway.