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Comment by TheMightyLlama | Hacker News Reader

America has _spent_ its oil buffer. It’s important to note the difference between a intentional use of an asset vs an unintentional loss of an asset.

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The SPR was set up as an emergency reserve. Not to manipulate the market price, which is only a temporary reprieve anyway. As soon as its exhausted and the supply issue is not addressed, we will likely be in the same boat as before without the cushion in case of a true national security emergency.

The SPR was created during an era when the US was an oil importer, fundamentally dependent on foreign supply. That’s no longer the case, thanks largely to the shale industry. So the national security calculus is completely different: instead the SPR is mainly an economic tool designed to buffer our economy against global price shocks during times of foreign turmoil, which is exactly the use-case it was just put to when Russia invaded Ukraine and global prices spiked. It should be refilled now, absolutely. But it is not a matter of national security anymore.

We should guarantee a price to refill the SPR, so US oil companies will continue to invest in US production for the medium term. https://twitter.com/mattyglesias/status/1572896629489041410?...

If done right, I don't see what's wrong with it. A dozen weeks back, oil was 120, now it is less than 80. We should be able to fill it back and make money while doing it.

We did the same thing saving GM more than a dozen years back.

It's worse than that: once we start refilling it we bring back all of the demand that releasing oil from the SPR kicked into the future.

It follows that if either 1.) demand drops or 2.) supply increases the refilling will create exactly the same problem in the future that releasing oil from the SPR was supposed to solve.

> It's worse than that: once we start refilling it we bring back all of the demand that releasing oil from the SPR kicked into the future.

Translating this into HNese, your argument suggests that disk drive caching shouldn't work. The answer is you can fill your reserves at a much lower rate than you empty them, taking advantage of many small windows.

It will set a floor on oil prices, keeping them from going as low as they otherwise would have. Some have argued that this is a good thing, since it will help to stabilize the "boom/bust" nature of the industry -- guaranteeing that oil producers continue to invest in expanding supply.

Is there any meaningful difference between "achieve a lower market price for oil" and "alleviate oil supply shortages"? If the SPR is not intended to alleviate oil supply shortages in a time of war, what else would it be intended for?

Think about what has happened in the past nine months. Russia, the country with the most nuclear warheads in the world, invaded its neighbor, where it proceeded to systematically torture and murder unarmed civilians, filling mass graves. Russia simultaneously threatened to invade members of the European Union and the NATO alliance, while threatening to use its nuclear weapons against any country that might dare to assist its victims in defending themselves.

In other words, there is a war in Europe, where the aggressor is one of the world's largest energy producers. How is this not the kind of "true national security emergency" (as you put it) that the SPR is intended to address?

To what end? The EU is no closer to oil independence and the Ukraine War looks no closer to ending with Russia’s mobilization.

There’s an election coming up in a little over a month for a president’s party who is historically unpopular. Everyone in this thread assures me that they hadn’t even considered the possibility that the SPR was used to buy votes, even though it looks like that’s the only tangible outcome of this since no strategic goals are being met.

Perhaps we got a good deal on the open market. Even if so - to what end? Temporarily depressed gas prices have yielded no significant strategic victories. Once prices rise again during the winter, we’ll be back to square one without the SPR.

Russia's actions have shown that it is not a reliable partner, and the "cheap" energy it sells actually comes with a very high political and national security cost. As a result, most European countries now know that they must realign their energy policies and economic relationships.

This kind of re-alignment takes time. By opening up the strategic reserve, Biden has given Europe more time than they otherwise would have had. Hopefully, it will be enough.

Western Europe has known this for decades and did not care. Germany used the past decade to decommision nuclear power and coal power. This was not a mistake and US taxpayer oil reserves should not be used to bail them out because they knew what they were doing.

Although it does benefit Europe, it also benefits the United States for Europe to finally turn away from Russia. Germany's prior willingness to engage with Russia may have been purposeful on Germany's part, but it was against the interests of the United States. The United States is not "bailing them out", but is instead making it economically possible for Europeans to align themselves with our own national security interests.

The alternative is for Europe to abandon the fight in Ukraine. This is something that the US taxpayer should be willing to pay to avoid.

If a legal voter, register your feedback on 08Nov.

roger

Excellent point. I lost my savings to a hot tub. Should I start a go fund me to recover it?

Is this a new spin on the 'lost my seed phrase in a boating accident' line?

Maybe "squandered" would be a better choice of words then. Anyway, the point is that there wasn't an actual oil shortage; prices were just high enough that it was making the government look bad. Releasing the oil only served to temporarily and artificially drop prices.

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