Should the Government Tap Into Oil Reserves to Manage Gas Prices?

In light of Middle East unrest, particularly in Libya, oil is now selling for over $100 a barrel. In the United States, prices at the gas pump have drivers frustrated and economists nervous for the tenuous economic recovery. The average price of regular gasoline around the country is $3.51 today, up from $3.18 a month ago and $2.73 a year ago—and this bump comes before the usual summertime gas price increase. Some have been calling for the government to help mitigate the price hikes by tapping into the nation’s emergency oil reserves. Obama's administration hasn’t ruled this out. “The issue of the reserves is one [option] we’re considering,” White House Chief of Staff William Daley said on NBC’s Meet the Press Sunday. He added that this “has been done in very rare occasions. There’s a bunch of factors that have to be looked at, and it is just not the price.”

The government drew from the Strategic Petroleum Reserve—deep storage caverns that can hold up to 727 million barrels of oil—during the first Gulf War in the early '90s and in 2005 after Hurricane Katrina temporarily damaged pipelines, refineries, and terminals, and disrupted about 25 percent of domestic oil production. The result was a 33 percent decrease in oil prices in 1991 and a 9 percent decrease in 2005, according to a letter to President Obama from Democratic Reps. Edward Markey of Massachusetts, Rosa DeLauro from Connecticut, and Peter Welch from Vermont. “American consumers are already suffering from high energy prices and the effects of the economic downturn,” the lawmakers wrote. “In the short term, considering releasing oil … could help prevent oil prices from escalating.”

Critics of the idea suggest this is not yet a true emergency since the oil supply is not cut off, and tapping into the reserves won’t help anyway.

What do you think? Should the government tap into emergency oil reserves to manage gas prices? Take the poll and post your thoughts below.

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