Biden and Xi Discussed Releasing Oil From Strategic Reserves

But the fact the world’s two largest oil consumers are even considering unprecedented joint action shows the level of concern that the rally in oil prices will stunt the global economy and further stoke inflation.

China has already tapped its strategic petroleum reserve at least twice this year in an effort to bring domestic crude oil prices down. Beijing has also released gasoline and diesel from a separate reserve.

The two sides agreed to keeping talking about oil markets and a possible coordinated response, the officials said.

Biden has grown increasingly alarmed about the impact of gasoline prices on consumer confidence amid a broader surge in inflation across the economy. After a request to the OPEC+ group of oil producers to pump more was rebuffed, the administration said it would look at other measures to cool the markets including a stockpile release.

The U.S.-China talks on strategic petroleum reserves were first reported by the South China Morning Post.

During their virtual summit, Biden and Xi “discussed the importance of taking measures to address global energy supplies,” according to the White House’s summary of the deliberations. Chinese state media said that both presidents discussed energy security.

The U.S. has sought support from big oil consumers in Asia including Japan and South Korea, but action together with China would be a first. China has built one of the world’s largest oil stockpiles over the last decade, but has only released supplies for the first time this year.

“The two presidents tasked their teams to coordinate on this issue expeditiously,” National Security Adviser Jake Sullivan said at a Brookings Institution event Tuesday.