Corporate socialism…..”Mike Sommers, the president and CEO of the American Petroleum Institute (API) this week told Fox Business, “We want the market to work, so we’re not interested in what some people are proposing right now in terms of federal bailouts.”
The HILL By Rachel Frazin – 03/13/20 04:14 PM EDT
President Trump said Friday that the U.S. would purchase “large quantities” of crude oil in order to help the industry, which has been hit by sinking prices this week.
“Based on the price of oil, I’ve also instructed the Secretary of Energy to purchase, at a very good price, large quantities of crude oil for storage in the U.S. Strategic Reserve,” he said during a Friday appearance in the Rose Garden to discuss the coronavirus. “We’re going to fill it right up to the top.”
An Energy Department official told The Hill in an email that the strategic reserve has the capacity to store up to 77 million additional barrels of crude oil.
As of Friday afternoon, American oil prices appeared to be slightly over $33 per barrel. If the U.S. were to purchase the full 77 million barrels to fill the strategic reserve at $33 per barrel, it would cost more than $2.5 billion.
Trump said that the move would assist the U.S. oil industry and help the country achieve energy independence.
On Monday, U.S. oil prices fell nearly 25 percent amid issues relating to the coronavirus as well as an ongoing trade dispute between Russia and Saudi Arabia.
Previously, the administration had planned to sell crude oil from the strategic reserve to raise money for upgrades and maintenance at the facility.
Energy Department spokeswoman Jess Szymanski said in a statement earlier this week that the sale would be suspended “in light of the recent fluctuations in global oil markets.”
Reports that the administration might seek to boost the industry in light of the plunge were met with criticism by many Democrats.
An environmental group also slammed the Friday announcement.
“This action speaks volumes about Trump’s priorities at a moment of national crisis. At a time when millions of Americans could be thrown into economic disaster, Trump is taking decisive action to protect polluter profits,” said a statement from Lukas Ross, a senior policy analyst with Friends of the Earth.
Some in the industry have also said they do not want federal assistance.
Mike Sommers, the president and CEO of the American Petroleum Institute (API) this week told Fox Business, “We want the market to work, so we’re not interested in what some people are proposing right now in terms of federal bailouts.”
The Strategic Petroleum Reserve is an emergency supply of crude oil established to lessen the impacts of international supply disruptions of petroleum products.
— Updated at 6 p.m.