Clinton Defends His Decision to Tap Oil Reserve
— -- President Clinton has decided to tap the United States’ Strategic Petroleum Reserve in the face of decade-high oil prices. Is it sound energy policy or election-year politics?
ABCNEWS.com
Sept. 23 — President Bill Clinton defended his decision to tap the country’s emergency oil reserve as “the right thing to do” to try to increase supply and reduce prices before winter. “Families shouldn’t have to drain their wallets to drive theircars or heat their homes,” he said today at the White House beforedeparting on a political trip to California.
The president announced Friday that 30 millionbarrels of the government’s petroleum stockpile would be put into the market.
Clinton also said today that $400 million in federal aid would be made available“to help families that can least bear the burden of high energyprices.” He said it was the largest such release of federal aid ever.
Overall, heating oil inventories are more than 20 percent lowernow than they were at this time in 1999, Clinton said. Inventoriesare down 50 percent on the East Coast and more than 60 percent inNew England, raising doubts about adequate supplies in the comingmonths.
In addition to the $400 million in energy assistance, Clintonsaid he was taking other steps to ensure that heating oil is“available and affordable for our families.” Among them:
— Asking the Environmental Protection Agency to help statesidentify ways to use more and different kinds of heating oil in aneffort to further build inventories. — Directing federal agencies to make early contractualcommitments to purchase heating oil throughout the winter. This isintended to give wholesalers “the confidence to build inventoriesin advance.”
— Asking state public utility commissions to make surefactories and businesses that use heating oil as a backup keepadequate reserves.
Oil and Politics
The 571 million barrels of crude oil that make up the emergency stockpile have become the latest flash point in the presidential race as Al Gore and George W. Bush clash over how to lower heating oil and gas prices.
Gore’s Republican rival argued the stockpile should only be tapped in a national emergency and accused the administration, which opposed using the reserve last winter, of playing politics with the nation’s energy policy.
“Ten months ago, the president and vice president thought it was a bad idea to release oil from the reserves,” Bush told reporters in Tampa, Fla., on Friday. “Now that we’re 45 days out of an election, they’ve changed their minds.
“I believe the vice president made this decision with the president’s support to achieve a short-tem political gain,” he added.
Bush’s advisers stressed that the emergency stockpile was designed for use during a national emergency and to protect against a sustained disruption of supply.
The Democratic candidate had urged President Clinton to tap the reserve.
Referring to the critics, Clinton said, “I doubt if they arerelying on home heating oil this winter.”
Clinton also criticized the Republican-controlled Congress forfailing to act on his energy proposals.
“Too many critical elements of our energy strategy have beenchop-blocked or ignored by the Republican majority in Congress,”Clinton said.
Bashing ‘Big Oil’
Gore’s advisers say they welcome an election-year fight over the oil issue, and believe it will only aid their efforts to frame the election as a choice between working families and wealthy corporations.
The vice president has accused American oil companies of price gouging and collusion and his advisers say Bush and Cheney — both of whom headed up oil companies — are in the pocket of the oil industry.
“Bush and Cheney do not want to spoil their big oil connections,” insisted Lehane. “That is why the Republican presidential ticket is not for opening the spigot.”
Bush is the founder and former CEO of Bush Exploration Oil and Gas and Cheney served as the CEO of Halliburton, a leading oil services company, until he resigned to run for vice president. Cheney received a $20 million retirement package from the company and holds approximately $45 million worth of Halliburton stock.
But the Democratic candidate has “big oil” ties of his own. The vice president is the executor of his late father’s estate, which holds some $500,000 worth of stock in Occidental Petroleum. Recently, the company went forward with a controversial plan to drill for oil in a remote region of Colombia that an indigenous tribe claims is sacred ground.
Gore’s proposal includes additional measures such as the creation of a permanent heating oil reserve in the Northeast, a temporary tax credit for oil distributors aimed at increasing heating oil supplies and $400 million in energy assistance for low-income families.
Bush Blames Failed Diplomacy
The Strategic Petroleum Reserve was established in 1975 in the wake of the 1973-1974 oil embargo. The emergency crude oil supply is stored in massive underground salt caverns along the Gulf of Mexico in Texas and Louisiana.
The first and last time the stockpile was used was by the Republican nominee’s father, President George Bush, during the 1991 Gulf War. The younger Bush says the Organization of Petroleum Exporting Countries — several of whose 11 members were participants in that conflict — should boost crude oil production. He blames the White House for failing to convince the cartel to do so.
The Texas governor also advocates opening up the 19-million-acre Arctic National Wildlife Refuge in Alaska to oil exploration.
The sprawling wilderness refuge set aside by Congress in 1980 represents 5 percent of Alaska’s oil rich North Slope. Currently, only 1.5 million acres are open to oil and gas development. Gore opposes opening any more of the territory to drilling, saying it would threaten the environment.
“We do not have to sacrifice our environment … in order to satisfy the appetite of big oil companies to go into new areas,” he told reporters in Pittsburgh on Friday.
ABCNEWS.com’s Carter Yang, The Associated Press and Reuters contributed to this story.