According to The Wall Street Journal, top oil producers Saudi Arabia and Russia are considering phasing out of their planned efforts to ramp up oil production after the U.S. and other energy-consuming countries said they would tap their national strategic petroleum reserves in an effort to bring down gasoline prices.
The Journal said on Wednesday that leaders in Riyadh and Moscow have led the 14-member OPEC in coordination with other oil-producing countries. According to the Journal, people familiar with the matter said that the United Arab Emirates and other members of the cartel are not sure whether such a pause is necessary.
The move came after President Biden ordered a record-setting 50 million barrels of oil released from the nation's Strategic Petroleum Reserve in hopes of lowering gas prices, a decision that was made in coordination with other countries like India, the United Kingdom and China.
The reserve has been used in several emergencies, including 2005 after Hurricane Katrina made landfall and destroyed swaths of the Gulf of Mexico oil infrastructure after a 1973 -- 74 oil embargo by Arab members of the OPEC. The Bush administration approved the release of 20.8 million barrels of crude oil to U.S. producers at the time.
In remarks from the White House on Tuesday, Biden said that while our combined actions won't solve the problems of high gas prices overnight, it's going to make a difference. It will take time, but before long you should see the price of gas drop where you fill up your tank. Proponents of releasing barrels from the emergency stockpile say that doing so would increase oil supplies and reduce prices at the pump, while also generating billions in revenue for the federal government. The country's oil-producing capabilities are not increased by releasing emergency supplies as a short-term fix to a problem, according to critics.
A gallon of gas, on average, was $3.41 nationwide on Tuesday, up from $2.11 a year ago, according to AAA.
Biden has called for the Federal Trade Commission to investigate whether companies are engaging in criminal conduct by profiting from artificially high prices at the pump, even though wholesale fuel costs decline.
Although Washington tried to convince the Saudi-led OPEC and a group of Russian oil producers to open up their taps and release more oil, the two groups that call themselves OPEC rejected the push. They are going to meet next week to review a deal they reached to boost their collective oil output.
The deal will boost output by 400,000 barrels a day each month through next year, until the group hits pre-pandemic levels. The COVID 19 shut down the global economy and demand evaporated in 2020, which was the subject of extreme cutbacks by the group.