Obama: Sell 30M oil barrels from reserves

Wary of a new surge in gas prices, the Obama administration said Thursday it is selling off 30 million barrels of oil from the country's emergency reserves as part of a broader international response to lost oil supplies caused by turmoil in the Middle East and North Africa, particularly Libya.

The release from the U.S. Strategic Petroleum Reserve will be the largest ever, amounting to half of a 60 million-barrel international infusion of oil planned for the world market over the next month.

Even so, the 30 million barrels to be sold by the United States represents less than two days' worth of domestic oil consumption and about three days of oil imports.

White House officials would not predict how the release will affect prices at the pump, although the move is intended to increase U.S. supplies during the peak summer driving season.

"We are taking this action in response to the ongoing loss of crude oil due to supply disruptions in Libya and other countries and their impact on the global economic recovery," Energy Secretary Steven Chu said.

The move comes as retail gasoline prices dropped for the 20th consecutive day, down a penny from Wednesday, to $3.61 per gallon, according to the AAA Daily Fuel Gauge Report. That's about 21 cents lower than a month ago.

The timing brought criticism from business groups and Republican lawmakers, who accused President Barack Obama of playing politics with the country's oil reserves, which are intended to address emergencies.

"The Strategic Petroleum Reserve is an emergency lifeline to protect our nation against critical shortages in our oil supply and shouldn't be used as a Strategic Political Reserve to boost the popularity of elected officials," said Charles Drevna, president of the National Petrochemical & Refiners Association.

The administration's action will do little to benefit consumers while leaving the nation vulnerable to hurricanes or other natural disasters, or a foreign crisis that causes a real supply shortage, said House Speaker John Boehner, R-Ohio.

"By tapping the Strategic Petroleum Reserve, the president is using a national security instrument to address his domestic political problems," Boehner said. "This action threatens our ability to respond to a genuine national security crisis."

Even some Democrats were puzzled by the move.

"This decision would have been more timely if made when the disruption in Libyan oil supplies first occurred" in February, said Sen. Jeff Bingaman, D-N.M., chairman of the Senate Energy and Natural Resources Committee. Still, Bingaman said he hopes the move helps deflate "speculative froth in the markets" and drives prices down.