Senate Democrats say they were able to eliminate a “bailout for Big Oil” to help secure a bipartisan agreement on a $2 trillion coronavirus economic relief package Wednesday.
Democratic leader Chuck Schumer released a summary of the agreement that says it no longer contains $3 billion to fulfill President Trump’s order to buy low-priced oil to restock the nation’s emergency Strategic Petroleum Reserve.
Earlier versions of the relief bill proposed by Republicans contained the funding, an amount requested by the Energy Department, which was intended to help the oil industry, which has been reeling from low prices.
But Democrats and Republicans haggled over energy and climate-related provisions, with Democrats asking for carbon emissions restrictions on airlines as part of the relief package.
However, both sides appeared to not get what they wanted.
The Trump administration and Republicans are likely to push for the $3 billion in Strategic Petroleum Reserve funding in future rounds of legislation.
Administration officials say restocking the SPR won’t halt the price crash rocking the shale industry, but they say it makes sense on energy security grounds and would benefit taxpayers. Congress has been selling off oil from the reserve in recent years to fund unrelated priorities, but a sustained period of low prices represents a good opportunity to fill the SPR back up, the administration says.
Congress created the SPR in response to the Arab oil embargo in the 1970s as a way to mitigate supply disruptions. The SPR currently holds just shy of 635 million barrels of oil, according to Energy Information Administration data, with room for 77 million more barrels, an amount that the $3 billion would have provided for.
