U.S. President Donald Trump's White House would sell half of the nation's emergency oil stockpile and open the Alaska National Wildlife Refuge to drilling as part of a plan to balance the budget over the next 10 years, documents released by the administration on Monday showed.
The White House budget, which will be delivered to Congress on Tuesday, is meant as a proposal and may not take effect in its current form. But it reveals the administration's policy hopes, which include ramping up American energy output.
The U.S. Strategic Petroleum Reserve, the world's largest, holds about 688 million barrels of crude oil in heavily guarded underground caverns in Louisiana and Texas. Congress created it in 1975 after the Arab oil embargo caused fears of long-term motor fuel price spikes that would harm the U.S. economy.
The Trump budget proposes to start selling SPR oil in fiscal year 2018, which begins on Oct. 1, with sales that would generate $500 million, according to the documents. The sales from the reserve would gradually rise over the following years, peaking at nearly $3.9 billion in 2027, and totaling nearly $16.6 billion from 2018 to 2027.
Past SPR sales have sometimes caused crude oil futures prices to drop by adding to available supply. In this case, that would work against Trump's efforts to revive the downtrodden oil and gas drilling industries.
U.S. crude oil prices on Monday settled at $50.73 a barrel, a relatively low level that has limited energy company profits.
The Trump budget would also seek to raise $1.8 billion over the coming decade by leasing oil in the Arctic National Wildlife Reserve, the largest protected wilderness in the United States, believed to hold rich reserves of crude.
Trump has already moved to expand U.S. offshore drilling, including in parts of the Arctic, as part of his broader effort to support the oil and gas industries. He has also moved to trim the U.S. Environmental Protection Agency, including by proposing a more than 30 percent cut to its funding.
The White House did not immediately respond to questions about the energy-related budget proposals. Trump's budget would also restart a nuclear waste fund that would bring in more than $3 billion by 2027.