the president of United StatesJoe Biden, will announce this Thursday the release of a million barrels per day of its strategic reserves for six months in an attempt to lower its price, the White House said.
“Following consultations with allies and partners, the president will announce the largest reserve release in history, placing an additional million barrels per day daily over the next six months,” the statement says.
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“The magnitude of this release is unprecedented: never in the world have reserves been poured (into the market) at a rate of one million barrels per day for so long. This record release will provide a historic amount to serve as a bridge until the end of the year, when domestic production increases “add note.
The move will dump a significant amount into the overheated global oil market.which has generated inflationary waves in the US economy.
Battling once morest bad data in the polls and with legislative elections in which the opposition is emerging as the favorite to regain control of Congress, the White House tries to show that Biden has a solution to a problem born in the pandemic and spread by the war in Ukraine.
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The release of reserves would be equivalent to increasing world supplies by regarding 1%.
The Petroleum fell sharply following initial reports of the US plan, which came as oil exporter group OPEC+ decided to modestly increase output ignoring calls to ease price pressure from the war in Ukraine.
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The release of US crude oil will dwarf previous uses of strategic reserves announced by Biden simultaneously with other countries on March 1 following the Russian invasionand also last year, in response to rising inflation.
Despite a recovering economy and the retreat of the covid-19 pandemic, Biden he gets little credit from voters, who instead blame him for rising prices everywhere from the supermarket to car dealerships.
Disruptions in the supply chain related to the different rates of economic recovery in the world are part of the phenomenon of inflation.
Also behind this politically dangerous trend are fuel costs, which, in turn, drive up transportation prices for almost all goods.
And for drivers, price shocks at gas stations are a constant source of irritation.
Gasoline prices are currently averaging $4.23 per gallon; 47% above a year ago.
The barrel of US WTI crude fell 4.6%, while in the future contracts of the barrel of Brent, European reference, the fall was 5.5%, to 107.20 dollars.
Crude oil prices reached almost $140 in March due to concerns regarding Russia, one of the world’s largest producers, which sparked a war in Ukraine and was the target of multiple international sanctions.
Prices have retreated a bit since the US banned Russian imports on March 8, but have hovered around $100 since then.
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