During my college years, in the shadow of the 1973 oil crisis, the US created the Strategic Oil Reserve. Back then, the idea was to have a reserve supply of oil in case we needed to fight a war while overseas oil imports were diminished.
Back then, we were dependent on imported oil for much of our supply. Today, we produce most of our own oil, due to increased domestic production; thus the reserve serves another purpose.
Since my college days, the use of our Strategic Oil Reserve has shifted to other goals; mainly the goal of stabilizing oil prices. When gas prices go up, Biden and other presidents, have dipped into the reserve to lower prices and to save their own political fortunes.
When prices go down, the reserve can be refilled. This practice can make money for the treasury due to the process of buying cheap / selling high.
It is not necessarily a bad strategy, but I also think this price stabilization effect can be done with carbon taxes that would be imposed when oil is too cheap. This would put a floor on oil prices so they are less apt to undercut alternative energy.
The tax could be removed or lowered at times when oil prices are high. That temporary tax cut could relieve the shock of sudden price hikes.
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