Crude oil in the US is cheaper by more than 1 percent. in response to the expected US administration announcement of a coordinated release of oil from strategic reserves. Investors are waiting for the response of the OPEC + countries to such actions, inform brokers.
A barrel of West Texas Intermediate crude oil in January deliveries on the NYMEX fuel exchange in New York costs $ 75.88, down 1.13 percent.
Brent on ICE in London for January deliveries is trading at $ 78.93 per barrel, down 0.97 percent.
US President Joe Biden is preparing to announce on Tuesday a coordinated action with other countries to release oil from strategic reserves (SWP), anonymous sources familiar with the plans of the US administration said.
Doing so, possibly in conjunction with India, South Korea and Japan, could be an unprecedented event in the efforts of major global crude oil recipients to lower oil prices.
The Chinese authorities are also working on releasing oil from their domestic reserves.
However, the situation on the markets is still changing and the plans to use oil from strategic reserves may also change.
Sources say the US is currently considering releasing more than 35 million barrels of oil from its reserves.
White House press secretary Jennifer Psaki “Jen” reported that the US is in touch with other countries, but refused to disclose how the US administration would act.
“We’ve spoken to many countries about the importance of making sure supply meets demand and helps prevent threats to global economic recovery,” Psaki told reporters.
U.S. President Joe Biden is under pressure to contain rising energy prices that are threatening US economic recovery from the Covid-19 pandemic.
However, the joint release of oil from strategic reserves in several countries will put them in a confrontation with the countries of the OPEC + alliance, led by Saudi Arabia and Russia – for control over world oil markets.
This may induce OPEC and its allies to reassess their oil supply plans, which assume increasing oil supplies by 400,000 every month. barrels a day.
“Such a move would potentially raise the stakes in + oil poker + and could create new tensions in bilateral relations between Washington and Riyadh,” said Helima Croft, chief commodity strategist at RBC Capital Markets LLC.
OPEC + countries are to meet on December 2 to consider whether they will increase oil supplies in January 2022 by 400,000. barrels a day. (PAP Biznes)
aj / os /