#SPR DRAWDOWN CHART VERIFICATION#
"And if the SPR has been partially exhausted, it can lead to a steeper escalation in prices.In the wake of the 1973-74 oil crisis, the United States (US) Congress enacted the Energy Supply and Environmental Coordination Act of 1974 (ESECA) and the more comprehensive Energy Policy and Conservation Act of 1975 (EPCA) with the specific aims to fulfil the US’s obligations under the International Energy Programme (IEP), to provide for the creation of a Strategic Petroleum Reserve (SPR), to conserve energy supplies, to provide for improved energy efficiency, to provide a means for verification of energy data, and to conserve water by improving water efficiency of certain plumbing products and appliances (EPCA section 2). "That's when you really need the SPR," noted Neil Beveridge, senior analyst at Sanford C. should be better prepared for a return of sky-high oil prices of over $120/bbl, given new shortfalls from geopolitical tensions, an energy war with OPEC and Russia, and higher global demand as China emerges from pandemic lockdowns. Only time will tell if the "buy low, sell high" strategy will work out, but the plan is to scoop up crude when costs are at or below about $67-$72 per barrel, an approach that "will protect taxpayers and help create certainty around future demand for crude oil."Ĭommentary: "The SPR was built for crisis - we're in a crisis, and it's not getting any easier," related Daniel Yergin, Vice Chairman of S&P Global. Reports suggest that the Department of Energy is also weighing limits on exports, while looking to put a mechanism in place to replenish the reserves at a fixed price. What remains to be seen is if the administration will go beyond its mega 180M barrel release, and if it does, how much farther will it go (watch President Biden's speech at 1:15 p.m. Don't forget that midterm elections are around the corner, and prices at the pump have been said to be a defining factor of any outcome, especially with voters worried about inflation and the economy. It also comes after OPEC and its Russia-led allies agreed to slash output by a whopping 2M barrels per day from November. 5, and to ensure prices keep falling from the historic highs recorded earlier this year. Snapshot: The extension intends to offset any market volatility that is expected once a European oil embargo goes into effect on Dec. So far, 165M barrels have been sold from the SPR this year, bringing volumes in the emergency stockpile to just 405M barrels, marking their lowest level since 1984. While the time frame keeps getting prolonged, the next 15M barrels coming to market will be part of the original 180M barrel release that was first authorized in March - due to inflationary shocks from the war in Ukraine.
Strategic Petroleum Reserve were only supposed to last until October, and then through November, but the Biden administration on Wednesday will extend the releases into December.
0 kommentar(er)
