Bloomberg News

Cameron Says No Decision Reached on Releasing Oil Reserves

March 15, 2012

U.K. Prime Minister David Cameron said that, while releasing oil from strategic stockpiles should be considered, there is no agreement with U.S. President Barack Obama on using reserves to reduce oil prices.

“We didn’t make any decision,” Cameron told students at New York University. “We’ve got to look at this issue carefully, it’s something worth looking at. Short term, should we look at the reserves? Yes, we should.”

Cameron told the students that he and Obama would “both like to see global oil prices at a lower level than they are.” Speaking earlier to reporters, Cameron said it’s “important that we do what we can to try to help families who are trying to make their family budgets add up.”

The price of oil in New York fell as much as 1.6 percent after Reuters reported that Obama and Cameron agreed to cooperate on a release from stockpiles, including the U.S. Strategic Petroleum Reserve. Futures pared the decline after Jay Carney, the White House press secretary, said reports that the leaders reached any kind of agreement are “inaccurate.”

With rising energy prices threatening to crimp the economic recovery, it “should not be surprising” that Obama and Cameron would discuss the matter, Carney said.

Crude oil for April delivery fell 8 cents, or 0.1 percent, to $105.35 a barrel on the New York Mercantile Exchange.

Price of Gasoline

The national average retail price of unleaded regular gasoline in the U.S. climbed to $3.821 a gallon yesterday, according to a daily survey by the American Automobile Association. That’s 7.5 percent higher than a year ago, according to AAA’s survey.

Rising gasoline prices have opened a line of attack for Republican presidential candidates, as higher energy costs in an election year overshadow gains elsewhere in the economy, including the addition of 227,000 new jobs in February.

Some Democrats in the U.S. Congress have urged Obama to use the oil stockpile as gasoline prices have risen amid a standoff with Iran over the Islamic republic’s nuclear program. Obama has cited turmoil in the region and greater demand from rapidly growing countries such as China and India.

Carney said he wouldn’t discuss deliberations about the strategic petroleum reserve. He repeated earlier statements that all options are under consideration to keep down energy costs. Obama has said there are no easy solutions.

No ‘Quick Fix’

“There’s no such thing as a quick fix when it comes to high gas prices,” Obama said in a speech today in Largo, Maryland, near Washington. “Anybody who tells you otherwise isn’t really looking for a solution.”

Releasing oil from the U.S. strategic petroleum reserve has proven no guarantee of lower prices at the pump over the last eight years. In four instances, gasoline rose following the announcements of supplies from emergency inventories. In 2008 and 2011, tapping stockpiles brought down the cost of a fill-up, according to data from AAA.

The strategic reserve was last tapped in July and August 2011 under an International Energy Agency effort to ease shortages in supplies from the Middle East.

To contact the reporters on this story: Robert Hutton in New York at rhutton1@bloomberg.net; Roger Runningen in Washington at rrunningen@bloomberg.net

To contact the editor responsible for this story: Steven Komarow at skomarow1@bloomberg.net


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