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Obama Proposes to Swap Oil from Strategic Oil Reserve

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August 04, 2008 10:09 AM

ABC News' Sunlen Miller Reports: While unveiling his "New Energy for America" plan today, presumptive Democratic presidential nominee Barack Obama will propose swapping light oil for heavy oil in the Strategic Petroleum Reserve, a stance the Illinois senator has not previously held.

"What he will be calling for in speech today is a swap out of light crude for heavy crude," Obama's Energy Policy Director Heather Zichal told reporters on a conference call today,  "The heavy crude will be replaced in the reserve at a later date so that we can get oil into the market."

Obama has long sided with President Bush that the strategic reserve should not be touched at this point – but like Republican rival Sen. John McCain has said because of current strain, more oil should not be added to the reserve.

Last month Obama affirmed his original position to reporters, "I do not believe that we should use this strategic oil reserves at this point," Obama said on July 7th in St Louis, "I have said and in fact supported a congressional resolution that said that we should suspend putting more oil into the strategic oil reserve.  But the strategic oil reserve I think has to be reserved for a genuine emergency."

The campaign says Obama's new proposal was recently decided on, after looking over similar swaps in the past which demonstrated the ability to bring costs down.

"Senator Obama has looked at the issue, he recognized that Americans are suffering, that we have a unique situation with rising gas prices," Obama Energy Advisor Elgie Holstein said, "This is one occasions where we really need to look at this strategically and he made the decision that we do need to tap the strategic petroleum reserve"

Obama's proposal to swap oil comes after a softening in position last week on off shore drilling - the Senator saying he would be open to a compromise that includes off-shore drilling as part of a longer term energy plan. 

August 4, 2008 in Kucinich, Dennis, Tancredo, Tom | Permalink | User Comments (26)

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Mike: "Obama panders to get votes..."

They all do, Mike. Where have you been?

First, let's look at this issue as it really is. The Republicans were all about national security, until Iraq wasn't working out so well. Then they turned their indignation on illegal immigration. It was the newest, most immediate crisis... 30 years in the making.

Then Iraq started to improve, so not a word about illegal immigration. But more recently, Iraq has started making noise about kicking us out. Uh oh, need to change that conversation again.

But this time it can't be illegal immigration, because Republicans don't like their own nominee on the issue. So... gas prices; drilling; more oil profits. Its the latest immediate crisis 30 years in the making.

Posted by: Paul | Aug 4, 2008 12:32:10 PM

Ironic that on the same day Obama says he wants to tap into the Strategic Oil Reserve, Iran boasts of being able to close the Strait of Hormuz, where much of the world's oil supply goes through. Obama obviously doesn't understand the meaning of "Strategic" (merely WORDS I suppose).

Kinda reminds me of Al Gore giving Global Warming speeches during blizzards.

Posted by: Bob in Florida | Aug 4, 2008 12:52:22 PM

The reserve is for an emergency similar to the oil crisis in 1973-74 or for temporary supply fluctuation. It is not appropriate to draw from it to delay long term solution. Obama and Pelosi need to be more responsible on this issue.

Posted by: FloridaCounts | Aug 4, 2008 2:16:15 PM

Another Ploy by the Obama Camp!
So which is it?
Does Obama now support off-shore drilling or releasing oil from the
Strategic Oil Reserve(which by the way is for Dire Energy Emergencies Not Cheap Political Tricks)?
Or does he support Both?
Obama has become the Desperation Man!
First he plays the "race card" and now he's flipping on off-shore drilling!
It's Not Working!
National Rasmussen Tracking Obama 46, McCain 47 McCain +1.0
Oh well Obama can go back to the
Senate after he loses and try to
add some accomplishments to his
record! Then maybe he'll be qualified to
be president in 2012 0r 2016!
President McCain, get used to it!

Posted by: reaganfan | Aug 4, 2008 2:50:52 PM

The SPR is 98% full, with over 700 million barrels of oil. To get a perspective, if we were to release 500,000 barrels a day for three months, the SPR would still be over 90% full. The SPR was never meant to be solely a protection against terrorist attacks, but rather, a more general tool to address supply or demand shocks. If the rapid rise of oil these past couple of months doesn’t qualify, then I really don’t know what would. The release of oil from the SPR would affect prices immediately whereas offshore drilling would not have any foreseeable impact on prices until 2030 (according to the Energy Information Association, http://www.eia.doe.gov/oiaf/aeo/otheranalysis/ongr.html).

Another question to ask is, why are we filling up the SPR when oil prices are sky high arguably because of all the uncertainty surrounding the subprime crisis, conflict in the middle east and general global malaise. Why not release this oil now when prices are so high and refill the SPR later, perhaps in a year, when it would still be about 60% full and prices may have come down. Of course this relies on the assumption that oil prices will retreat from its stratospheric levels, with which you may or may not agree.

Posted by: SXC | Aug 4, 2008 11:11:55 PM

Enemies of America would like nothing better than for us to have a bunch of inept politicians, like Obama, Pelosi and Reid, pushing us to squander our strategic oil reserves ... so that if they close the straights of Hormuz, we wouldn't have any emergency oil to use. Are these the kind of leaders you want to protect us, and keep America strong? The liberal's idea of globalization only works when the countries they are pandering to either meet us half way, or abandon their goals to destroy us. In additionl, we don’t even know if the ‘other things’ that are supposed to bring us alternative energy will be cost effective, or even work. However, I agree that we must move forward with development of alternative energy ASAP … but, in the meantime, this entire country runs on oil. And, I’m not just talking about us consumers at the pump, I’m talking about how everything we use, eat, wear, etc. … how it all gets to market, and eventually to us. We have to drill more, if even as a transition until alternate fuels are developed, But, aside from the cost at the pump for consumers, the bigger issue still is our national security. Drilling oil on our own land insures us energy independence, which will stop us from total dependence on countries who don’t like us … and from countries we’ve been sending tens of billions of dollars to every year. We must drill ASAP. The politicians who tell you different are simply placing petty party politics above the prosperity and security of America. Obama’s policies are just one example of what can happen when a bunch of inexperienced, but exuberant followers blindly follow an inexperienced, incompetent charismatic leader, who thinks he’s the second coming, off the cliff. Hunger is not enough of a justification to eat the goose that lays the golden eggs … or, eventually everyone will starve. If Obama, with his socialistic redistribution of wealth scams wins, America will turn into a third world country, with massive company closures and unemployment, within a few years.
Elect a man who truly loves America, and will protect her ... elect Senator John McCain in November.

Posted by: HOWARD | Aug 5, 2008 12:22:12 PM

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