Tuesday, May 13, 2008

Putting the Strategy Back in the Strategic Petroleum Reserve

The U.S. Senate voted this afternoon to stop oil deliveries to the Strategic Petroleum Reserve for 6 months to try to lower the summer cost of oil and gasoline. This is a move that makes a lot of sense. It could lower the price of gasoline by, I’m guessing, 3 cents a gallon all summer long. At the same time, it will actually save the U.S. government money by having it buy crude oil at times when prices are lower.

The idea of the Strategic Petroleum Reserve was supposed to be that the U.S. government buys crude oil when prices are low, stores it in a hole in the ground, and pulls it out in time of emergency. Congress envisioned that the President would stop oil purchases on his own in times like this, when the reserve is nearly full and oil prices are hitting new records every week. After all, the name includes the word “strategic,” which seems to imply that a strategy ought to be used to maximize the economic benefit. But the current White House is so resistant to this idea that Congress is having to take action to force it to follow the intent of the law.

I don’t see this as an example of Congress trying to micro-manage government operations. The action could save the government a quarter of a billion dollars and help the broader economy at the same time, and it is something the President is supposed to be doing on his own initiative. It is reason enough for Congress to take action.

The House is expected to pass a similar measure later this evening.