Tulane Energy Expert Says Opening Oil Reserves Will Drop Gas Prices Temporarily
New Orleans, La. – Eric Smith says tapping the reserve for 30 days at a million barrels a day will likely lower prices, but the effect will be temporary.
"Probably a month from now you could expect to see some effect on gasoline prices, but it will only last for a month because everyone who deals in oil and gas knows it's only a 30-day program."
The White House notes the move comes as demand peaks in summer months, and high gasoline prices are gutting household budgets. Smith says the government will also be making money from the sale.
"The good news is, it'll generate about $3 billion in income for the federal government, which is about half of what they get via royalties and lease sales in a given year. They can use the money."
The last time the reserve was tapped was after Hurricane Katrina in 2005.
For WWNO, I'm Eileen Fleming