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Biden calls on "OPEC" and oil suppliers around the world to increase production


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 2022-03-24 09:59
 

Shafaq News/ The US Energy Information Administration said today, Thursday, that the crude oil stockpile in the Strategic Petroleum Reserve of the United States fell 4.2 million barrels last week to 571.3 million barrels.

 

This is the largest weekly drop in crude stocks in the Strategic Petroleum Reserve since August 2011.

 

The Energy Information Administration said that US exports of crude oil rose last week to 3.8 million barrels per day, the highest level since July 2021.

 

The US Agency added in a weekly report that US crude production stabilized at 11.6 million barrels per day last week for the seventh consecutive week.

 

It also said that refinery utilization rates in the US Gulf Coast region rose last week to 94.3%, the highest level since January 2020.

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Analysis by 
June 17, 2022 at 7:53 a.m. EDT
 

The US has become the world’s oil barrel of last resort, single handedly keeping prices in the energy market from exploding even higher by selling a large chunk of its Strategic Petroleum Reserve. Washington can’t use the reserve forever: it’s a finite stockpile fighting a potentially unlimited flow shortage. More worryingly, the US is depleting its cache a lot faster than it looks.

 

And that matters. The International Energy Agency earlier this week warned that “global oil supply may struggle to keep pace with demand next year.” The SPR may be the final cushion late this year and in 2023 to put a lid on oil prices — and global inflation. What Federal Reserve Chair Jerome Powell and his peers around the world do with interest rates hinges in large part on energy market developments. 

To understand the limits of the SPR, one has to go into the plumbing of the reserve itself, and the inner workings of the US oil-refining industry. Over the past year, the White House has sold almost 115 million barrels from its hoard, with the releases surging to a record high of nearly one million barrels per day since mid-May. At the current rate, the US is selling more barrels from its reserve than the production of most medium-sized OPEC countries, such as Algeria or Angola.

 

If Washington sticks to its current pace, the reserve will shrink to a 40-year low of 358 million barrels by the end of October, when the releases are due to stop. A year ago, the SPR, located in four caverns in Texas and Louisiana, contained 621 million barrels. As the oil market looks today, it’s difficult to see how Washington can halt sales in October. Removing that additional supply would mean commercial inventories quickly deplete, putting upward pressure on oil prices.

In theory, what’s going to be left beyond October would still allow the White House to sell more crude in November and December, and into next year. But there’s an important catch: Not all of the crude set aside is equal, and what’s left is, increasingly, far less useful than what’s already gone. 

Broadly speaking, the SPR contains two kinds of crude: medium-sour, and light-sweet. The first adjective refers to the oil’s density, the second is about sulphur content. Typically, US refiners prefer medium-sour crude, which is denser and has more sulphur but is a variety they can easily process into gasoline and other products thanks to their highly sophisticated plants.

 
 
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The medium-sour the US has set aside matches the kind of crude its domestic refiners process. The stockpiled medium-sour has a density of 31.9 API degrees and a sulphur content of 1.44%, mirroring the average crude Americans refiners have processed over the last five years, which has a density of 32.6 degrees and 1.34% sulphur. The light-sweet in the reserves has a much higher density, at 35.8 degrees, and far less sulphur, at 0.4%. Medium-sour is the quality of crude pumped by Russia, most Middle Eastern countries and Venezuela.

For that reason, the White House has prioritized the sale of medium-sour barrels, satiating the refiners’ appetite for their favorite crude. Over the last year, 85% of the oil the SPR has sold has been medium-sour, according to an analysis based on government data. Considering that refining is one of the biggest bottlenecks right now in the oil market, satisfying the preferred diet of American oil refiners is crucial. The biggest companies — Marathon Petroleum Corp. and Valero Energy Corp. — have been big buyers at SPR auctions in the last six months, helping the industry to profit from record-high refining margins.

As the White House fed American refiners with their preferred variety, those sales have reduced the amount of medium-sour crude inside the reserve dramatically —  and it’s set to decline further over the next four months. OilX, a consultant, estimates that by the end of October, the SPR will hold only 179 million barrels of medium-sour crude. To put that into perspective, during the period June 2021 to October 2022, the US is likely to sell about 180-190 million barrels of medium-sour crude from the reserve. Clearly, Washington is running out of firepower to repeat that exercise. 

 
 

What’s left still leaves the White House with some ammunition — but not a lot. Already, the government has started to offer more light-sweet crude than medium-sour in its most recent tender for SPR barrels. Regardless of the preference of refiners, any barrel is still better than no barrels. But with the good stuff already nearly gone, the world can’t keep relying on the US strategic reserve to keep oil prices in check.

With that in mind, next month’s trip by President Joe Biden to Saudi Arabia makes a lot more sense. The Saudis, and their neighbors in the United Arab Emirates, pump medium-sour crude. That’s all what you need to know. 

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 2022-06-19 10:22
 

 

Shafaq News / US Energy Secretary Jennifer Granholm confirmed on Sunday that President Joe Biden has asked all oil suppliers around the world, including "OPEC", to increase production.

Granholm stated, "The US President is focused on putting an end to inflationary increases to the maximum extent possible, and wants to achieve a steady and stable recovery, especially after inflation reached unacceptable levels," adding, "We believe that economic stagnation is not an inevitable issue."

In late March, US President Joe Biden announced his country's plan to end dependence on foreign oil and achieve independence, and that he directed his administrations to withdraw one million barrels of oil per day from the strategic oil reserve for a period of 6 months.

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On 6/20/2022 at 6:31 AM, yota691 said:
 
 2022-06-19 10:22
 

 

Shafaq News / US Energy Secretary Jennifer Granholm confirmed on Sunday that President Joe Biden has asked all oil suppliers around the world, including "OPEC", to increase production.

Granholm stated, "The US President is focused on putting an end to inflationary increases to the maximum extent possible, and wants to achieve a steady and stable recovery, especially after inflation reached unacceptable levels," adding, "We believe that economic stagnation is not an inevitable issue."

In late March, US President Joe Biden announced his country's plan to end dependence on foreign oil and achieve independence, and that he directed his administrations to withdraw one million barrels of oil per day from the strategic oil reserve for a period of 6 months.

 

What a complete joke this guy is. The US needs to start extracting oil again. Things have changed since Biden made the decision to stop. Nobody gives a hoot if the US needs more oil supply. Exchange between countries is great for economics, but this is a crisis, not a trade game anymore. This is likely obvious to everyone, I'm just venting. Heck, even the UN is going to crank up the coal for heat for a short time until this thing blows over with their natural gas supply. 

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There's probably a lot of people that would like to impeach Biden, but the alternatives could be worse. Not sure what is worse than the gas prices though. Only a year and a half to go until his term is done, right?

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23 minutes ago, Goggles said:

There's probably a lot of people that would like to impeach Biden, but the alternatives could be worse. Not sure what is worse than the gas prices though. Only a year and a half to go until his term is done, right?

Two and a half years

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13 hours ago, screwball said:

this fool has caused the shortage and recession they are collapsing the economy on purpose.

Too right...a Month ago this fool admitted as much when referencing skyrocketing gas prices.

Public Enemy #1 to be sure. My opinion here, but if you're deliberately ( for the sake of the Green Agenda ) destroying the economy and it's people, isn't that - dare I say treason ?

Perhaps Slo Joe has no recollection of the Oath of Office when he was sworn in.

" C'mon Man, let's just skip the  :bs: and get to the " ...so help me God part ! ....( I gotta Agenda to ram down everyone's throat).

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16 hours ago, Goggles said:

 

What a complete joke this guy is. The US needs to start extracting oil again. Things have changed since Biden made the decision to stop. Nobody gives a hoot if the US needs more oil supply. Exchange between countries is great for economics, but this is a crisis, not a trade game anymore. This is likely obvious to everyone, I'm just venting. Heck, even the UN is going to crank up the coal for heat for a short time until this thing blows over with their natural gas supply. 

they will start extracting oil again under a new government unfortunately we have to put up with the pain, it will get worse before it gets better but I do believe the end is near for the cabal and evil POS!

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