While we hope that the Northeast Home Heating Oil Reserve will be up and running this winter, we believe that additional steps must be taken. Unless averted, this winter s expected crisis could have a disastrous impact on the American people especially the elderly, working families, family farmers, small businesses, the disabled and the poor. With heating oil inventories at historically low levels, severe price spikes are expected again this winter. In fact, home heating oil prices have already started to rise and could end up substantially higher than last year. With low storage levels, increased use of natural gas for electric generation, and higher industrial use, we can only expect higher prices.
Gasoline prices remain high.
Today we are importing significantly more oil than we did during the energy crisis in the 1970s. Recently, we have experienced significant electric rate increases in a number of areas including California, New York and parts of Montana. Rolling brownouts, blackouts and poor power quality can result from an over burdened system forced to supply electricity for peak loads. The SPR currently contains 576 million barrels of crude oil. Investment experts in the petroleum market believe that just a small release of oil from the reserve could immediately stabilize prices and convince OPEC ministers to increase production by a modest amount.