Breitbart reported yesterday that President Trump has directed the Secretary of Energy to purchase large amounts of oil at the current low price to be placed in the U.S. strategic reserve. This is a great idea. It builds up our strategic reserve, and it helps the oil companies that may be struggling with the sudden drop in oil prices.

The article reports:

“We’re going to fill it right up to the top, saving the American taxpayer billions and billions of dollars, helping our oil industry [and furthering] that wonderful goal — which we’ve achieved, which nobody thought was possible — of energy independence,” Trump said.

Trump’s announcement follows market turmoil in the international market when Russia and Saudi Arabia’s negotiations recently broke down and the Saudis announced they were increasing production.

The industry reacted positively to the president’s announcement, CNBC reported.

“It is a fantastic idea,” John Kilduff, founding partner of Again Capital said in the CNBC report. “The SPR is one of the few levers that the U.S. can pull in times of oil market tumult.”

“It has served the country well when supplies get tight or otherwise become unavailable during times of natural disasters or geopolitical turmoil,” Kilduff said. “Releases of supplies have served to short-circuit price rallies in the past, and this filling may well serve to ebb the current sell-off.”

“Russia, the world’s second-largest producer, does not appear willing to return to its agreement with the Organization of the Petroleum Exporting Countries (OPEC), which has kept oil in a range around $30 a barrel for much of the last week,” CNBC reported.

Saudia Arabia is the de facto leader of OPEC.

So far, President Trump has been ahead of the curve in dealing with the consequences of the coronavirus–stopping flights to America from China and from Europe, setting up private-public alliances to provide testing and research for vaccines, and declaring a national emergency. Shoring up America’s oil reserves at this time is also a very wise move.