Oil Prices Rise as US Plans to Tap Oil Reserves

Oil prices are on the rise as the U.S. plans to release more crude oil from its Strategic Petroleum Reserve. Light sweet crude ended yesterday up 3.3% at about $85 per barrel. 

The President said the U.S. would release 15 million more barrels of oil from the reserve, which would be the last sale from the planned sale of 180 million barrels of oil announced shortly after Russia invaded Ukraine in February.

President Biden signaled that when oil falls below $70 per barrel, the administration would begin buying back oil to refill the reserves. SPR levels have fallen to just over 400 million barrels, down about 40% from its usual reserve levels and the lowest since 1984. President Biden also said he will consider more reserve sales this winter.

Oil prices have been rising since OPEC and its allies agreed to cut production by roughly 2 million barrels a day. Gas prices have started to drop in the last week, but the national average for a gallon of gas is 20 cents higher than it was a month ago, according to AAA, with average gas prices about 56 cents higher than a year ago.