Posted on 03/25/2022 10:03:22 AM PDT by blam
Minutes after reports of another Houthi missile strike on a Saudi Aramco facility sent oil prices to the highs of the session (while slamming the Nasdaq to a new daily low), a headline hit the tape trumpeting the possibility of yet another SPR release by the Biden Administration, as President Biden grows increasingly desperate to convince the US that he’s ‘doing something’ to counteract inflation, and punishing prices at the gas pump.
#Biden Administration considering releasing more than 30M barrels from Strategic Petroleum Reserve
— Marco Ða Costa (@TraderMarcoCost) March 25, 2022
Of course, just like last year’s SPR release, which actually sent oil prices higher as the strategy backfired spectacularly, another shot of supplies from the reserve would probably be futile.
To further illustrate this point, the chart below shows that a release of 30M barrels from the reserve (which is supposed to be reserved for emergencies) would be tantamount to a drop in the bucket, quickly dissolving like spit on a hot griddle.
In fact, this time around, it’s possible – even likely – that the backlash could be even more punishing, since, when adjusted for the present level of implied demand, SPR levels are already at their lowest levels since 2002, with just 33 days of supply.
But like the old saying goes: if at first you don’t succeed, then try, try again. In all likelihood, President Biden and his team probably aren’t all that concerned with the short-term market impact, since political decisions like these are all about optics anyway.
Of course, Einstein seems to have been right: “insanity is doing the same thing over and over again and expecting different results.”
And when another SPR release fails to do much of anything to drive prices lower, how much longer until the administration resorts to the next logical steps, being 1) gas stimmies (like our European allies) before 2) price controls?
How does President Pudding Cup plan to refill it?
L
How does President Pudding Cup plan to refill it?
~~~
He asked his advisers if we can just put wind mills inside the storage tanks
Oh wait, not that SPR?
Russian oil.............................
Maybe the real goal is to fully drain the SPR.
“How does President Pudding Cup plan to refill it?”
The same way a meth addict gets more product....
Uh, I dunno.....oh wait....I see somebody I can rob!
The SPR is nothing in comparison to the daily use of oil in the US.
It is supposed to be a strategic asset but it has become (under both parties) some mythical unicorn that can be called upon to blow skittles out of its rear end to make the public happy.
In reality it does nothing. It has no more consequence than a pebble thrown in a pond.
Petroleum seepage from the bowels of muvver erf?
I was thinking what will the Democrats use to totally destroy the SPR
Let me see...."it's racist" because Blacks in Africa don't have access to an SPR.
Also, by refilling it the prices for the poor are driven higher worldwide.
They’ll just sell it off and then when it’s empty ... “Oopsie! Looks like we misread the dipstick. So sorry”.
Hey Brandon, show some leadership and just drain it already. I dare you. Hell, I Double-Dog Dare you.
If the SPR is to be used at this time, it should be used to replace oil exports to Europe, which would quickly starve Russia of revenue.
In the meantime, increase production so North America can continue to supply Europe’s needs.
Oh, why not just sell it one the open market.
It’s not like we might NEED it for anything like warfighting.
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