Legal

A “Strategic Resilience Reserve” (SRR) could follow the model of the Federal Reserve’s efforts to address financial stability risk: aiming to prevent crises, and reducing harm when they occur.

This is the fourth piece in the Contingent Supply series, which looks at the operational requirements, financial needs, and economic opportunities involved in using the SPR to stabilize oil markets.

The administration’s recently proposed regulation for flexibly refilling the SPR is a welcome policy change with serious potential to deliver price and supply stabilization benefits.

Given the discretion afforded the Secretary in utilizing the ESF, and the strong correlation between commodity price volatility and exchange rate volatility, the Secretary has the authority to establish a Supply Insurance and Acceleration Program for key commodities.