Tap Reserves, Israel Says, as Gas Prices Climb

U.S. Rep Steve Israel (D-Huntington) said Tuesday that he wants President Barack Obama to consider using the Strategic Petroleum Reserve to stabilize gas prices.

On Long Island, gas prices are up 15 cents in the last week. One website  said Long Island gas prices went on average from $3.36 on Jan. 28 to $3.59 on Feb. 28. This afternoon, that site was showing Huntington prices for regular gas ranging from $3.56 to $3.59.

Israel said, “For OPEC and speculators, oil price spikes mean profits. But for Long Island families, it means an unexpected economic burden. Instability in the Middle East means we’re paying at the pump here at home. Over the long term, we need the United States to transition off of foreign oil. And for the short term, we need to provide relief and prevent unmanageable gas prices that hurt families and slow economic growth. A small drawdown of the Strategic Petroleum Reserve can help us do that.”

Taking the edge off just a bit was a Suffolk County tax cap that took effect Tuesday on wholesale gas prices exceeding $3 a gallon.

Robert Lipp, deputy director of the Suffolk County Legislature Budget Review Office, said that the sales tax cap wouldn’t affect pump prices until they go over $3.30 per gallon.

"The tax cap is on the wholesale price," Lipp said. "So the point to be made is that if consumers are seeing a price of $3.30 at the pump, that is the equivalent of a wholesale price of $3.00."

“The newly effective gas tax cap will provide relief for all county residents that are truly feeling the squeeze at the pump,” said Suffolk County Legislator Lou D’Amaro (D-Huntington Station), who provided the pivotal swing vote to approve the bill out of the Budget and Finance Committee of the Suffolk County Legislature and supported its final adoption. “This fiscally responsible law is projected to save consumers roughly $2.5 million over five years.  It strikes a good balance between assisting taxpayers and honest budgeting, while providing realistic ways to make up for lost revenues by cutting portions of the legislature’s own operating budget.  It is also an excellent way to wean ourselves off of a regressive tax, which disproportionately affects the middle class.”

The Strategic Petroleum Reserve holds 727 million barrels of oil. Once oil is released from the reserve, it takes less than two weeks to enter the market, according to the Department of Energy.

The reserve has been used previously to help stabilize oil prices. 

Analysts are warning that increased crude oil prices could slow economic recovery and cause a sharp increase in the cost of U.S. oil imports.

Suffok County Legislator Steve Stern (D-Huntington) said, “The volatility of energy prices strains family budgets and reduces consumer buying power at a time when our entire community is dealing with the challenges of the economic downturn.” 

“This measure is a fiscally responsible way to give much needed relief to motorists struggling with the high cost of living in Suffolk County and to provide additional discretionary income to residents. I am proud to stand with my fellow taxpayers, not the oil companies, and join with my colleagues as we continue to hold the line on taxes in Suffolk County.  With continued unrest in the Middle East, it is important that we work hard to provide solutions for relief at the pump while also focusing on alternative energy sources locally," Stern said.