U.S., U.K. to Call for Strategic Petroleum Reserve Release?
With the price of WTI (West Texas Intermediate) crude oil under $100, elected officials in both the U.S. and the U.K. are apparently contemplating releases from the Strategic Petroleum Reserves in a move that, at least in the case of the U.S., sounds a little desperate during this election year.
Sanctions on Iranian oil exports are purportedly the reason for calling for more oil, but with the Saudis producing record amounts of the stuff and with U.S. production rebounding, maybe policymakers should consider that heightened expectations for more money printing around the world is really driving prices higher.
This Reuters report indicates “U.S. officials will monitor market conditions over the next few weeks, watching whether gasoline prices fall after the September 3 Labor Day holiday, as they historically do” and, if not, they’ll consider tapping U.S. reserves.
In the U.K., this story at The Telegraph quotes a government official as saying, “We and our international partners continue to monitor the oil market and stand ready to call upon the International Energy Agency to take appropriate action as required. No decisions have been taken to release stocks at this stage. The market remains very tight. This has a knock-on impact on the oil price and therefore the global economic recovery”.
Maybe government officials know something the rest of us don’t…