Monday saw the price of oil shoot up after news broke that President Joe Biden’s plan to curb the price of gasoline was to release a million barrels of emergency oil reserves daily.
According to a report by The Daily Caller the Brent crude index, which is the global oil benchmark, increased to $108.07 per barrel Monday morning meaning that it surged to more than 3.1% overnight.
Additionally, the U.S. WTI index skyrocketed more than 3.4% past $103 per barrel Monday, which is considered to be a big increase in a commodity that has the eyes of the world trained on it.
“Will the release of barrels from strategic reserves fill a shortfall caused by sanctions and buyer aversion to Russian oil? In a word, no,” Stephen Brennock, an analyst at PVM Oil Associates, told Reuters.
Biden said Thursday that the Department of Energy to release a million barrels of oil from the Strategic Petroleum Reserve (SPR) every day for six months, and the following day the International Energy Agency pledged their own release of 62.7 million additional barrels of oil.
Biden remarked that the oil release would lead to gas prices declining by as much as 35 cents a gallon, however, White House economic adviser Jared Bernstein said that SPR releases were a “time-limited function” during a press briefing on Friday.
“It’s not a ‘strategic price reserve.’ It was never intended for this and it won’t do anything, just like the last one,” Institute for Energy Research President Tom Pyle told the Daily Caller News Foundation after Biden’s announcement.
“This is about nine days worth of demand, but even less because a barrel of crude from the Reserve does not equal a barrel of gasoline.”