Oil Reserve Released from John Gotti's Head
Controversy erupted on Friday when President Clinton announced his decision to release 30 million barrels of oil from the United States' Strategic Petroleum Reserve. This was a response to the continuous rise in oil prices, which began slowly 18 months ago and has been gaining speed and attention ever since.
The entire nation has been affected by the steadily rising gasoline prices, although for the average consumer, they represented an annoyance rather than a crisis. Businesses--particularly those that rely heavily on oil, such as shipping companies and airlines--have tightened their belts and raised their rates. Many consumers did not notice that there was anything unusual about the rate increases, although they have hurt lower-income families. Because the effects were small and spread out across a variety of areas of life, the average American did not realize the extent of the latest energy crisis. However, with winter coming on and no end in sight to the rising prices, homeowners in the northern states have become increasingly vocal on the subject of the reserve.
The reserve has two main purposes: to protect the country's energy supply in case of war or other similarly disastrous occurrences, and to reduce the leverage of oil-producing countries in diplomatic situations. Those who oppose the release say that the reserve is not intended as a price-control device, suggesting that this is a frivolous waste of an important protection. Supporters counter this by pointing out that the 30 million barrels represent only five percent of the total reserve. In addition, the plan is to sell these barrels to oil companies, who will promise to replace them at a later date, thereby bringing the reserve back up to full strength. Apparently Clinton is ready to take the risk that all of the reserve will be needed before the oil is replaced.
There has been a great deal of speculation about Clinton's motives for doing so. Given that Clinton's Vice President happens to be running for the office of President of the United States, many feel that the release is intended to give Gore a boost in November's election. The timing of the decision supports this: on Thursday, Gore announced that he would push for the release of a conservative five million barrels of crude oil. The next day, Clinton released 30 million barrels. While it will take some time for all of that oil to be sold and refined, meaning that the reserve oil will not be on the market until early December at the soonest, the announcement has already caused a noticeable drop in oil prices. Clinton does not deny that the release will help Gore, but he says that it is also the right thing to do economically. Since 1973 there have been three energy crises, all of which have ended in a recession. So far there is no recession on the horizon, but economists across the country are revising their predictions for this year's economic growth downward. Originally six percent growth was the estimate for this year; now it is 5.2%, and expected to sink even further.
Gore's main opponent, Texas Governor George W. Bush, has been very vocal in criticizing the release, claiming that Gore has been inconsistent. As recently as February, Gore opposed any release of crude oil. However, Bush points out, he changed his mind as the election drew closer. In Florida in recent days, Bush has repeatedly referred to Gore as a "flip-flopper," saying such things as: "Florida wants to turn back from the past of double-talking, of changing positions, of just kind of talking one way and doing another." Bush suggests that, instead of using the reserve, more drilling should be done in America to find new sources and lower the prices. He apparently suggested the Alaska National Wildlife Refuge as a good potential drill site, which infuriated the notoriously environment-conscious Gore.
Gore acknowledges that his position has changed, but says that the situation has changed, as well. Last winter oil prices were high, but this winter they are significantly higher. He feels that the magnitude of the increase justifies his change of position on the issue.