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Release of oil from the SPR have had a significant effect on oil prices. But the SPR isn’t a major source of supply, when you look at the numbers. Total global demand for crude oil is around 100 million barrels per day, while SPR releases last week were 7.5 million barrels, or about 1 million barrels per day. That affects oil prices for sure, in the finely balanced oil market, which doesn’t have much storage compared to daily demand. But we haven’t really glutted the market...we’ve just cooled off an overheated market.

Gasoline demand has been very sluggish over the last few months. Last week, demand was down to 8.7 million barrels per day from 9.6 million last year. This is just personal observation from Arizona, but I’ve noticed people are driving slower overall on the highways and more people are using the air compressors at gas stations to inflate their tires. People start using less gas when the price gets up around $4 per gallon.

The SPR is not close to empty, and was at 442.5 million barrels last week. I expect to see more politically-motivated releases from the SPR into the mid-term election.
I stay out of the oil market, which is really the Wild West of the trading business. Here’s the last oil status report:

https://ir.eia.gov/wpsr/overview.pdf

"Release of oil from the SPR have had a significant effect on oil prices. But the SPR isn’t a major source of supply, when you look at the numbers. Total global demand for crude oil is around 100 million barrels per day, while SPR releases last week were 7.5 million barrels, or about 1 million barrels per day. That affects oil prices for sure, in the finely balanced oil market, which doesn’t have much storage compared to daily demand. But we haven’t really glutted the market...we’ve just cooled off an overheated market.

Gasoline demand has been very sluggish over the last few months. Last week, demand was down to 8.7 million barrels per day from 9.6 million last year. This is just personal observation from Arizona, but I’ve noticed people are driving slower overall on the highways and more people are using the air compressors at gas stations to inflate their tires. People start using less gas when the price gets up around $4 per gallon.

The SPR is not close to empty, and was at 442.5 million barrels last week. I expect to see more politically-motivated releases from the SPR into the mid-term election. I stay out of the oil market, which is really the Wild West of the trading business. Here’s the last oil status report:

https://ir.eia.gov/wpsr/overview.pdf"

Thanks for the reply.

It is true that the SPR is not a major source of oil. That is not the point though. When you are dealing with large amounts of a commodity, you know that it is the prices ON THE MARGINS that matter. You dont' have to be 25% of the market to have a really dramatic effect on prices

also re: "The SPR is not close to empty, and was at 442.5 million barrels last week." How much we have is not the issue. It is how much we have vs how much we are letting go, and what "critical levels" are considered to be. I don't think anyone expects us to sell down to zero.

Just for the record, I think the SPR is a terrible idea. Armies run on oil, I get that. However, I am in favor of making it so difficult and expensive to send our army out to another country that we would just say "ahhhhhhhh, not worth it" to about 80% of our expeditionary forays. That is just me, though.