UPDATED 10:34 AM PT – Monday, April 4, 2022
Former Treasury Secretary Larry Summers said Joe Biden’s verbal attacks on oil companies are not helpful in curbing high gas prices. In a recent interview, he criticized Biden’s plan to sell oil from the Strategic Petroleum Reserve (SPR).
Summers asserted that instead of just selling a million barrels per day, the Biden administration should have committed to buying back that oil one year from now at a $10 discount. He then suggested the U.S. Treasury could make a profit on the SPR release.
“So, the government can sell oil for above $100 and promise to buy that oil back in the range of $90,” Summers explained. “And then, a year from now, we’ll have the same sized Strategic Petroleum Reserve we had before. And we’ll have $10 a barrel times say 100 million barrels of oil, which is $1 billion.”
I applaud the Biden Administration’s massive SPR release. It should be coupled w a forward purchase of oil to offset environmental issues and replenish the reserve.
— Lawrence H. Summers (@LHSummers) April 2, 2022
Summers also said the U.S. government must use a “modern financial approach” to strategic reserves to lock in profits while selling that oil.