US Administration officials are looking at refilling the Strategic Petroleum Reserve (SPR) that was used unwisely, claims Joe Biden's critic. Based on a report by Bloomberg last Tuesday, President Joe Biden does not find it drastic enough to fill up the SPR, only if it's $80 per barrel.
Oil Producers Refuse To Sell Oil to the US at Low Prices
On Tuesday's oil market, Brent Crude originating from the North Sea was trading at $92.71 per barrel, whereas West Texas Intermediate (WTI), the New York Stock Exchange futures performance indicator pumped in the Great Plains, has been fetching $87.76 per barrel, reported Sputnik News.
Last Monday, the US Energy Department statistics revealed that SPR stock had tumbled to 434.1 million barrels of crude oil, its biggest drop since 1984. The agency sold 8.3 million barrels of the stock to oil companies last week, surpassing the 1 million barrels a day declared by Biden in March.
Notwithstanding the domestic need for lower fuel prices in the United States, as expressed by the US administration, the OPEC+ petroleum cartel, which includes many US allies, is committed to maintaining crude oil costs above $90 per barrel; that bars filling up the strategic petroleum reserve.
OPEC agreed last week to decrease crude production by 100,000 barrels per day. In July, Biden decided to visit Saudi Arabia in a quixotic effort to persuade the royal family to lower oil prices.
Biden's Attempt To Lower Fuel Prices
In late March, Biden vowed to start the biggest and longest SPR withdrawal in US history, at a frequency of one million barrels per day for six months, or 182 million barrels of oil.
Oil companies bought the crude and reacted by wanting to sell it in larger markets like Europe, raking in record profits while fuel prices in the United States continued to rise significantly.
In June, the president clobbered ExxonMobil for making a profit from oil; the company, along with Chevron, issued their second-quarter earnings reports in late July, disclosing a quadrupling of profits during the same period the previous year.
High gasoline prices were responsible for high oil prices, so both trends have been publicly scapegoated for continuing to drive record inflation in the United States and several other countries.
However, based on an April study by the Economic Policy Institute, company earnings accounted for 54% of inflation in the United States in 2021 and 2022. Trying to imply that enterprises are attempting to raise their prices even though customers know price increases also double inflationary pressure from other issues, like pandemic-related expenses.
Even after the release of the SPR and the Federal Reserve's significant increases in interest rates, inflation has stayed high: the Bureau of Labor Statistics' Consumer Price Index (CPI), which also tracks shifts in the cost of staple goods.
On Tuesday, there was an 8.3% uptick in oil prices over the previous year, and in August 2022, it was among the highest seen in the last year.
NY Stock Exchange Suffers Setbacks
The Dow Jones slumped well over 900 points in afternoon trading as a consequence of the headlines, mentioned WSJ.
New York Stock Exchange (NYSE) suffered one of its terrible setbacks in recent history after shareholders sold stocks in response to a Tuesday report that showed that inflation stayed high last month.
The US Administration remains hesitant to fill up what it took from the strategic petroleum reserve, even if it would be very unwise.
Related Article : US Strategic Petroleum Reserve in Danger Getting of Exhausted as Biden Administration Struggles To Stop Runaway Gas Prices
