empty
 
 
US risks losing its oil buffer
03-10-2022 07:13
US risks losing its oil buffer
US risks losing its oil buffer

The efforts of the Biden administration to reduce global commodity prices could go in vain as the United States risks losing its cushion reserved for oil shocks, The Wall Street Journal reported.
In September, the Strategic Petroleum Reserve (SPR) in the United States decreased by 7 million to 427 million barrels, the lowest since 1984, according to the Energy Information Administration (EIA).
In 2022, the United States has been depleting its SPR rapidly. On Monday, September 26, the Energy Department said it would sell 155 million barrels of crude oil from the Reserve, as part of the president's historic release announced on March 31 to help bring down prices. Back then, Joseph Biden authorized the Energy Department to sell up to 180 million barrels of crude oil to reduce prices and boost supply.
In this light, the daily volume of crude released by the US government totaled 900,000 barrels per day, which offsets 1% of global demand, experts estimated. As the GasBuddy data shows, fuel prices in the country have dropped to $3.66 a gallon over the past three months. In mid-June, the price of one gallon reached $5.03.
Biden’s historic reserve release is believed to be successful only in the short term. According to The Wall Street Journal, this measure is unlikely to enhance US energy security. The US SPR is depleted, which means the country will have fewer options in case of supply disruptions, as the risks of a supply squeeze are still high.
Moreover, a decrease in crude exports from Russia is weighing on global oil flows. Additional restrictions will come into effect with the EU embargo on December 5, 2022. Above all else, there are risks that OPEC+ would cut production if global oil prices fall and the situation in the world generally gets worse.

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST
  • Chancy Deposit
    Deposit your account with $3,000 and get $8000 more!
    In March we raffle $8000 within the Chancy Deposit campaign!
    Get a chance to win by depositing $3,000 to a trading account. Having fulfilled this condition, you become a campaign participant.
    JOIN CONTEST
  • Trade Wise, Win Device
    Top up your account with at least $500, sign up for the contest, and get a chance to win mobile devices.
    JOIN CONTEST
  • 100% Bonus
    Your unique opportunity to get a 100% bonus on your deposit
    GET BONUS
  • 55% Bonus
    Apply for a 55% bonus on your every deposit
    GET BONUS
  • 30% Bonus
    Receive a 30% bonus every time you top up your account
    GET BONUS
Can't speak right now?
Ask your question in the chat.
Widget callback