So the annual gas-price panic has begun in Washington, spurred by onset of summer driving season and election-year politics. This morning, the International Energy Agency (IEA) – the global agency that coordinates international energy policy – announced that it would release 60 million barrels of oil from strategic reserves around the world. The U.S. will contribute half the amount, releasing 30 million barrels of oil into the world market over the next month. In a statement, Energy Secretary Steven Chu explained the decision:
We are taking this action in response to the ongoing loss of crude oil due to supply disruptions in Libya and other countries and their impact on the global economic recovery. As we move forward, we will continue to monitor the situation and stand ready to take additional steps if necessary.
In the coming weeks, expect much talk about how the high price of gas will kill off the U.S. economy as well as ever-shriller calls to open up protected areas for exploration and drilling. Luckily, the Center for Investigative Reporting has put together a terrific short video on the true price of gas. It's well worth watching, if only as a reminder that no matter how many million barrels of oil we release from strategic reserves, the era of cheap gas is over – permanently.