Some early forecasts are calling for an especially cold winter in parts of the United States, and cold weather will mean high heating bills for many. The price of oil reached a 10-year high in early September, and despite the recent pledge by the members of the Organization of Petroleum Exporting Countries to boost production by 800,000 barrels a day, prices are not expected to drop significantly in the near future. In addition, inventories of heating oil are at lower than normal levels, which could lead to shortages in some areas.

To counter high heating prices and lessen concerns about shortages, some have called on the Clinton administration to release oil from the Strategic Petroleum Reserve (SPR). The SPR was established in 1975 with passage of the Energy Policy and Conservation Act (EPCA) to serve as an emergency supply of crude oil in case of a major supply disruption. Today, the reserve consists of approximately 580 million barrels and has been drawn upon only once, during the Gulf War in 1990 and 1991. EPCA authorizes the president to draw upon the SPR when it is "required by a severe energy supply interruption or by obligations of the United States." In 1992, the Energy Policy Act expanded the regulations to allow use of the SPR in when a severe supply reduction is combined with a high oil prices and is therefore likely to have an adverse impact on the economy.

The Department of Energy has stockpiled two million barrels of heating oil to be used in case of a severe shortage in the Northeast. However, the Clinton administration has signaled that releasing oil from the SPR is an option still under consideration as a way to provide relief to heating oil consumers all over the country.

On One Hand...

It is estimated that it will cost $901 to heat the average home in the Northeast this winter, which is an increase of $400 from just two years ago. With heating oil prices at a 10-year high, this is going to be a very difficult winter for many Americans. Money that families would otherwise spend on consumer goods and services will now be required to pay the heating bill, and this could hurt the economy. President Clinton should authorize the release of oil from the SPR to increase supply and lower prices. The nation's vast reserve exists for an emergency, and the skyrocketing price of heating oil qualifies.

On the Other Hand...

The SPR is only meant to be used in case the supply of oil to the United States is cut off by a war or other disruption. While it is unfortunate that heating bills will be high this winter, the situation is not an emergency. The current high price of heating oil is a result of market forces, and President Clinton should not use the SPR to manipulate the price. Heating oil prices were low two years ago, and producers and suppliers reduced their stockpiles as a result. Now that prices have gone up, supplies are low and consumers will feel the bite. But high prices will also result in increased production, which means that prices might not be quite so high next winter.

• Although the U.S. has 3 percent of the world's proven oil reserves, it consumes approximately 28 percent of the daily world production (DOE)

• In 1994, the U.S. depended on imports to meet over 50 percent of its petroleum requirements, and this dependence is expected to increase to almost 70 percent by the year 2010.

• The nation's inventory of crude oil has been rising in recent weeks, but it is still almost 22 million barrels below its level at this time last year and not too far from a 24- year low. The distillate inventory, from which home heating oil is made, is 28 million barrels below its level at this time last year.

• OPEC's latest production increase may come too late to ensure plentiful oil supplies when cold weather hits the United States because it takes about six weeks for the crude oil to get to the U.S. and another week or 10 days to refine it.

Department of Energy, New York Times