With energy costs spiraling out of control and diesel prices driving inflation, the White House and strategic energy partners around the world plan to flood the market with crude oil.
Pres. Joe Biden announced he authorized the release of “one million barrels per day for the next six months. Over 180 million barrels from the Strategic Petroleum Reserve.” He also indicated this six-month fix would be followed by the oil industry ramping up production by year’s end.
Since gasoline, home heating oil, and diesel spiked to record highs, exacerbating 40-year high inflation, the White House has softened its pro-green, anti-fossil fuel position. Oil and natural gas drilling licenses that had been at a standstill due to the Biden Administration changing regulations broke loose after energy companies prevailed in court. The war between Russia and Ukraine has increased already record-high fuel costs.
“The biggest concern is Europe stops doing business with Russia. This could lead crude and natural gas to trade significantly higher,” Tyche Capital Advisors managing member Tariq Zahir, reportedly said.
New rounds of energy sanctions by the U.S. and EU countries are expected to include coal, oil, and natural gas. European nations are inherently dependent on Russia for large percentages of their fossil fuel resources. Without increased supply, fuel costs threaten to plunge wide-reaching countries into recession. Countries associated with the International Energy Agency (IEA) reportedly agreed to tap 60 million barrels of oil from storage above the 180 million-barrel supply announced by Biden.
“The @IEA is moving ahead with a collective oil stock release of 120 million barrels (including 60 million barrels contributed by the U.S. as part of its overall draw from its Strategic Petroleum Reserve),” IEA’s executive director Fatih Birol reportedly tweeted.
News of the massive crude oil release had an immediate impact on prices. Oil futures dipped to their lowest levels in three weeks, with U.S. costs per barrel falling below $100 overnight. West Texas Intermediate crude promptly dropped by $5.73 (5.6 percent) and settle at $96.23 per barrel.
“This historically large (Strategic Petroleum Reserve) release is the right decision in the current crisis and consumers should feel the benefit soon. But it only solves half the problem,” Rystad Energy consultant Claudio Galimberti reportedly said.
Galimberti noted that the EU and other global energy users rely on Russia for upwards of 2 million barrels per day. The release of oil reserves will likely buoy EU needs and lower truck diesel in the U.S., to some degree, as Russia shifts its oil sales to other nations.
Since energy costs escalated, the White House has reportedly made significant energy policy reversals. The president reportedly called for penalties on the release of public lands not used to produce oil and employed the Defense Production Act to increase mineral mining for batteries.
Freight hauling operations can anticipate lower diesel costs in the near future. However, reliance on foreign oil producers may impact prices at the pump in the coming months.
Sources: wsj.com, fox10phoenix.com, npr.com
You noticed how close it is to the electrons? Well I wonder how many foolish democrats and independence will still vote Biden or another candidate whose votes won’t count for anything all because he’s doing this. He has cost thousands of jobs and hardships on the American people just for his twisted party. Those of you who love this country and because of religion, laziness or whatever other reason won’t vote for the republican party that has done the best for this country would be better if you moved out You will hopefully continue to have hardship like those are.
Well, that’s enough for less than 10,000 trucks, excluding all other vehicles, land, air, and sea, of different types of course!
What will that do for the market price of fuel and how long do we have to pay before we see relief? Promise after promise doesn’t make the price come down enough to reflect a difference just like other governments in the world, promise of guaranteed and higher pay leads to not being able to afford even essential items