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U.S. senator urges Trump to tap fuel, oil reserves in Harvey's wake
August 31, 2017 / 2:30 AM / 3 months ago

U.S. senator urges Trump to tap fuel, oil reserves in Harvey's wake

WASHINGTON (Reuters) - A Democratic senator on Wednesday urged U.S. President Donald Trump to tap the country’s emergency gasoline or crude oil reserves to help alleviate motor fuel price spikes resulting from Tropical Storm Harvey.

Senator Edward Markey said in a letter to Trump that an immediate release of gasoline from the nation’s oil product reserve, or crude oil from the Strategic Petroleum Reserve (SPR) would help protect consumers from price increases at the pump and tame market speculation that could harm consumers.

“Immediately tapping the SPR, including using the SPR authority to release gasoline from the Northeast Gasoline Supply Reserve, could help protect consumers by putting downward pressure on markets and combating any market speculation that may be occurring,” Markey said in the letter to Trump.

Harvey has shut 24 percent of U.S. fuel output after refineries in Texas and Louisiana were flooded.

U.S. gasoline futures this week briefly hit $1.91 a gallon, the highest since July 2015, after the outages.

But gasoline prices are relatively cheap compared to levels earlier this decade, and the end of the peak summer driving season could prevent a further dramatic rise unless there is long-term damage at major refineries.

Markey is a member of the Senate environment and public works committee and has long pressured administrations on consumer issues related to energy.

The Northeast Gasoline Supply Reserve, set up after Hurricane Sandy caused fuel supply disruptions in 2012, holds 1 million barrels of motor fuel at three sites in New York Harbor, the Boston area, and Maine.

The SPR is a series of heavily guarded underground salt caverns along the coasts of Texas and Louisiana currently filled with nearly 680 million barrels of mostly sour crude oil.

With Gulf Coast refineries and ports shut after Harvey, it was unclear whether there would be strong demand for an immediate release of crude from the SPR.

The Energy Department has said repeatedly it stands ready to provide assistance “as deemed necessary” to release crude from the reserve. It has not commented since Harvey on whether it would release fuel specifically from the gasoline reserve.

Editing by Jeffrey Benkoe

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