Clinton Releases Funds to Make Oil Affordablegreenspun.com : LUSENET : TB2K spinoff uncensored : One Thread
Saturday September 23 12:21 PM ET
Clinton Releases Funds to Make Oil Affordable
By Deborah Charles
WASHINGTON (Reuters) - President Clinton (news - web sites), expressing concern about Americans having enough heating oil this winter, said on Saturday that sharply lower oil inventories and high prices sparked his decision to tap the nation's oil reserves.
Clinton also announced a series of measures, including the release of $400 million in Low Income Home Energy Assistance Program (LIHEAP) emergency funds to all states to help low-income households faced with sharply rising prices for heating oil, natural gas and propane.
It is the largest release of LIHEAP emergency funds ever, Clinton said.
In a statement at the White House before leaving on a trip to California, Clinton said his decision to release 30 million barrels of oil from the Strategic Petroleum Reserve (SPR) -- the first such release in a decade -- was ``the right thing to do.''
``As it stands, overall heating oil inventories are more than 20 percent lower than they were last year, 50 percent lower on the East Coast. More than 60 percent lower in New England,'' he said.
``The underlying cause of low inventories is the high price of crude oil,'' he said. ``The overriding purpose for our action is to increase supply and help consumers make it through the cold winter. Families shouldn't have to drain their wallets to drive their cars or heat their homes.''
Clinton said he hoped his move will help ease crude oil prices, which rose to their highest level in a decade earlier this week.
``I think this is a prudent thing to do to increase stocks for the winter and to try to make sure it has a moderating effect on prices, but basically to deal with the supply issue,'' he said when asked if he thought prices would fall in response to his decision. ``And normally in a market situation, the price will follow. That's what I hope will happen here.''
In Caracas OPEC President Ali Rodriguez on Saturday described the U.S. decision to release oil from its reserves as a positive move that will reduce oil prices.
``The increase of 1 million barrels per day (bpd) from the U.S. reserve, with the extra OPEC supply due on the market in October, will reduce speculation and we think that is positive,'' Rodriguez told foreign journalists, noting that oil prices had already fallen on Friday following the announcement.
Asked about criticism by Republicans including presidential nominee George W. Bush who called the intervention as a ``bad idea'' aimed at helping his rival, Democratic Vice President Al Gore, Clinton said he was just trying to help out with the problem of low oil stocks.
He said the administration debated the issue for weeks, and pointed out that his plan was in the form of a swap.
Under the plan, the 30 million barrels of crude oil will be lent to energy companies, which will sell the crude in the open market or refine it into heating oil. The companies must promise to return the oil, plus more barrels, to re-stock the reserve next year when prices are lower.
``So what we're trying to do is to compensate for the fact that the stocks are too low and the price is too high now and to get the oil back into the reserve in the springtime when the stocks are supposed to be higher and the price is supposed to lower,'' Clinton said. ``I think it's plainly a prudent thing to do.''
Gore had urged Clinton to release between 30 million and 35 million barrels of oil from the reserve in batches. Gore's call, made within weeks of the November election, was criticized by Bush who said it put the nation's security at risk and was made to achieve short-term political gains.
In other actions announced on Saturday to help make sure heating oil is available and affordable to all families, Clinton directed federal agencies to make early contractual commitments to purchase heating oil throughout the winter to help wholesalers build advance inventories.
He also urged states to help ensure that factories and businesses that use heating oil as a backup fuel keep adequate reserves.
Clinton called on Congress to support his energy proposals that include incentives to help people buy fuel-saving vehicles and energy efficient buildings and help fund clean energy technology.
-- (email@example.com), September 23, 2000
"Families shouldn't have to drain their wallets to drive their cars or heat their homes."
Thanks Bill. This 12mpg SUV was getting to be a drag.
-- Must (Be@n election.year), September 23, 2000.
Perhaps albore will next suggest that Clinton use part of the National Surplus to help families pay off their SUV's and luxury cars.
-- Gore (firstname.lastname@example.org), September 24, 2000.