Clinton proposes withdrawal from reserves

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Clinton to urge OPEC to increase oil production March 17, 2000 Web posted at: 7:05 p.m. EST (0005 GMT)

WASHINGTON (CNN) -- President Bill Clinton on Saturday is expected to call on the Organization of the Petroleum Exporting Countries to increase oil production and announce a modest initiative that ultimately would help the nation ease its dependence on foreign oil, CNN has learned.

One initiative the president is expected to announce is a new program that would permit modest withdrawals from the Strategic Petroleum Reserve, but it will take almost a year to get the program operating, and would do nothing to immediately lower the costs of gasoline and home heating oil.

White House officials say the president is expected to emphasize that the long-term solution to the current gas problem rests on diplomacy.

The national petroleum reserve is held for times of national emergency, but as gas prices continue to rise, several Republican lawmakers have called for a release of oil from the strategic reserve -- or exploration of the Arctic National Wildlife Refuge, known as ANWAR, that is thought to be potentially rich in untapped oil.

And the issue has become campaign fodder for Reform Party presidential hopeful Pat Buchanan, as well as Republican candidate Texas Gov. George W. Bush.

Buchanan, for his part, took aim at Bush, saying recently on NBC's "Meet the Press": "We defend Saudi Arabia and Kuwait. They conspire against us. What does Bush have to say about this? Nothing. He agrees fundamentally with Clinton."

Bush has staked out a position of his own, setting his sights on chief rival, Democratic Vice President Al Gore.

"I can't understand how the administration can't get cooperation from Saudi Arabia, Kuwait and Mexico," Bush said last week during a campaign stop in Plant City, Florida. "It is not so long ago that a President Bush helped Kuwait."

Gore has said he believed OPEC would agree to release more oil: "We've been working the diplomatic circuit very hard to get that decision and I'm optimistic."

Gas prices have risen to more than $1.50 a gallon in many areas, and U.S. Energy Secretary Bill Richardson predicted earlier this week that prices could rise as high as an average of $1.75 per gallon before dropping in late spring or early summer.

"Here's my hope," Richardson said during testimony before the House Appropriations subcommittee on Wednesday. "If OPEC meets and decides to increase production at a sizable level, late spring, early summer you will see a gradual decrease in gasoline and diesel prices."

The oil cartel is scheduled to meet March 27 in Vienna, Austria and Richardson said he is hoping the oil ministers will approve a "substantial increase" in oil production, which would result in a price decrease.

"What we expect the oil companies to do is as the cost of oil goes down, that those savings are immediately passed on to consumers and that there should be no lag," White House spokesman Joe Lockhart told reporters Thursday. "That's something that we'll be watching very closely."

That is not soon enough for the GOP. Republicans charge the Clinton administration has failed to keep the pressure on OPEC, and has allowed U.S. oil production to diminish.

"It's time to have a new administration so that we have a fresh energy policy and we don't have this problem," House Speaker Dennis Hastert (R-Illinois) recently told reporters.

CNN's John King and Brad Wright contributed to this report.

http://cnn.com/2000/ALLPOLITICS/stories/03/17/oil.reserve/index.html

-- Martin Thompson (mthom1927@aol.com), March 17, 2000

Answers

Another view.

WIRE:03/17/2000 18:46:00 ET No decision on U.S. oil stockpile pending -2 Siewert said that the strategic oil issue "will not be the crux" of President Clinton's expected announcement about oil Saturday, but declined to elaborate.

Siewert described a CNN report that the president would announce Saturday the release of some crude oil from the nation's emergency stockpile as a temporary measure to ease high prices as "inaccurate".

CNN quoted unnamed sources who said the president would announce the dramatic step before he leaves for India Saturday. The network described the amount of oil involved as "modest" but did not elaborate.

The Clinton administration has spent several weeks considering a so- called oil swap proposal, in which some crude oil would be removed from the 569-million barrel Strategic Petroleum Reserve for energy companies to sell on the open market. In exchange, they would promise to replace greater amounts of oil by year-end when prices are expected to be much lower.

http://abcnews.go.com/wire/World/reuters20000317_3534.html

-- Martin Thompson (mthom1927@aol.com), March 17, 2000.


Get the tag line on this story, about the proposed swap arrangement: replaced when "prices are expected to be much lower."

This is supposed to be at year end. Dreamers!

-- Uncle Fred (dogboy45@bigfoot.com), March 18, 2000.


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