Boosting U.S. Oil Production "Misdiagnosis": Psaki

A proposal by Republican lawmakers to increase U.S. crude oil production amid the fast-deteriorating situation in Ukraine that could compromise the security of energy flows was a "misdiagnosis", according to White House press secretary Jen Psaki.

"The way that the president, President Biden, has approached sanctions is we want to take every step to maximize the impact and the consequences on President Putin while minimizing the impact on the American people and the global community," Psaki told ABC's George Stephanopoulos, as quoted by The Hill.

"The Keystone Pipeline was not processing oil through the system. That does not solve any problems. That's a misdiagnosis or maybe a misdiagnosis of what needs to happen," Psaki also said.

"I would also note that on oil leases, what this actually justifies in President Biden's view is the fact that we need to reduce our dependence on foreign oil, on oil in general ... and we need to look at other ways of having energy in our country and others."

President Biden came into office with an ambitious energy transition agenda foreseeing billions in spending on a buildup in wind and solar power generation capacity and the electrification of transport. However, oil demand has been on the rise both across the world and in the world's largest consumer.

As a result, prices at the pump have been on a more or less uninterrupted rise for months, prompting President Biden to ask OPEC to boost its production over the agreed OPEC+ quota. The cartel refused to pump more, which led to the release of crude oil from the U.S. strategic petroleum reserve. This arrested the price rise for a short while, but now prices are back up again.

As of February 27, the national average stood at over $3.60 per gallon, the AAA reported. Brent crude was trading at $102.50 per barrel at the time of writing, and West Texas Intermediate was changing hands for $96.49 per barrel, both up by more than 4 percent.

By Irina Slav for Oilprice.com

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