U.S. and International Energy Agency Tapping Oil Reserves

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June 23, 2011

WASHINGTON -(Dow Jones)- The U.S. government on Thursday said it would release 30 million barrels of oil from its strategic petroleum reserves as part of an effort to offset disruptions caused by unrest throughout the Middle East.

Over the next 30 days, the U.S. government and its partners in the International Energy Agency will release 60 million barrels of oil onto the world market, the Department of Energy said in a statement.

“We are taking this action in response to the ongoing loss of crude oil due to supply disruptions in Libya and other countries and their impact on the global economic recovery,” Energy Secretary Steven Chu said in a statement.

The administration has faced growing pressure in recent months to release oil from the reserves as unrest has pushed gas prices upward. The administration–up until now–had declined to tap into the reserves, saying the stored oil should only be released during major supply disruptions.

The reserves now hold 727 million barrels of oil, a historic high, according to the DOE.

The average price of regular gas is $3.61 in the U.S.

The DOE said its decision is intended to complement production increases recently announced by other countries. “The United States welcomes those commitments and encourages other countries to follow suit,” the DOE said in a statement.

-By Jared A. Favole, Dow Jones Newswires

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