Democrats urge Obama to tap oil reserve

strategic petroleum reserveLawmakers say the move would calm speculators, who are driving up oil prices based on Mideast violence. By Steve Hargreaves, senior writer


NEW YORK (CNNMoney) -- Three House Democrats urged President Obama Thursday to tap the nation's Strategic Petroleum Reserve as turmoil in the Middle East pushed oil prices over $100 a barrel.

In a letter to Obama, Massachusetts Representative Edward Markey, Connecticut Representative Rosa DeLauro, and Vermont's Peter Welch said soaring energy prices stemming from supply disruptions and rampant speculation in the oil markets are making it hard on American consumers and businesses.

"We therefore urge you to consider leveraging the SPR to respond to these supply disruptions and combat the rapid price escalations," the letter said.

The nation's strategic reserve, located man-made underground salt domes in Texas and Louisiana, holds 727 million barrels of oil. That's enough to cover U.S. oil imports for 85 days, or most of the oil exported from the Persian Gulf for 48 days.

The lawmakers said releasing oil from the SPR would send a strong message to oil traders that the American government is ready to act.

The White House did not immediately respond to an email seeking comment.

Oil prices have surged 14% since protests began in the Middle East two months ago, with most of that rise coming in just the last week.

Oil prices dropped 33% when President Bush tapped the SPR during the Gulf War in 1991. Prices also dropped 19 percent when Bill Clinton tapped it in 2000 and 9% when George W. Bush used it following Hurricane Katrina, the lawmakers pointed out in their letter.

Ray Carbone, president of the oil trading firm Paramont Options, said releasing oil from the SPR is one of the things traders were watching for, and that it could help calm oil prices, if only temporally.

So far, it appears that Libya is the only country to see its oil output cut as a result of the recent upheaval. Reports Wednesday said half of the country's 1.6 million-barrel a day oil production is shut in.

But traders fear the unrest could spread to other, larger oil producers in the Persian Gulf, which provide the world with about a fifth of the 87.5 million barrels it consumes daily.  To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 17,663.61 -8.99 -0.05%
Nasdaq 4,767.73 9.85 0.21%
S&P 500 2,054.51 2.69 0.13%
Treasuries 1.82 0.01 0.44%
Data as of 2:18pm ET
Company Price Change % Change
Bank of America Corp... 15.83 0.10 0.64%
Apple Inc 113.74 0.76 0.67%
General Electric Co 24.61 0.13 0.53%
Intel Corp 35.93 -0.51 -1.41%
Microsoft Corp 46.75 -0.43 -0.91%
Data as of 2:03pm ET

Sections

Severe winter storms cost airlines a ton of money -- but they actually hit passengers harder. More

As the snow hits the Northeast, shoppers are stocking up on a lot more than bread and milk. More

IBM calls report of 112,000 layoffs "ridiculous" and "baseless." But layoffs are coming. More

First introduced in 2007 as way of sifting through Twitter's newsfeed, the hashtag has since spawned new tech businesses and become a pop culture phenom that retailers are cashing in on. More

Target-date funds have become a wildly popular option among those seeking a hands-off approach to retirement investing. But not all of these funds are created equally. More

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2015 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2015. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2015 and/or its affiliates.