Government & Regulatory | Oil & Gas Prices

Biden to Release One Million BPD from Reserves for Six Months; Push for Federal Leasehold Production

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The White House and President Joe Biden have announced that they will be releasing one million barrels per day from the US' Strategic Petroleum Reserves in order to curb gas prices, according to an official statement released by the White House.

The statement also stated that the Biden Administration will seek to levy penalties on operators that hold federal leases, but are not using them for current production.

The statement read in part: "After consultation with allies and partners, the President will announce the largest release of oil reserves in history, putting one million additional barrels on the market per day on average – every day – for the next six months. The scale of this release is unprecedented: the world has never had a release of oil reserves at this 1 million per day rate for this length of time. This record release will provide a historic amount of supply to serve as bridge until the end of the year when domestic production ramps up."

Pressure on Producers with Federal Leases

Additionally, President Biden is planning to impose financial penalties on domestic oil and gas producers that lease on public lands, but are not producing.

The statement noted that: "The oil and gas industry is sitting on more than 12 million acres of non-producing Federal land with 9,000 unused but already-approved permits for production. Today, President Biden is calling on Congress to make companies pay fees on wells from their leases that they haven’t used in years and on acres of public lands that they are hoarding without producing. Companies that are producing from their leased acres and existing wells will not face higher fees. But companies that continue to sit on non-producing acres will have to choose whether to start producing or pay a fee for each idled well and unused acre."