Under US leadership, six countries put oil on the market because the oil cartel OPEC and its allies refuse to significantly increase production.
US President Joe Biden on Tuesday announced the release of its strategic oil reserves to reduce petrol prices. The White House said China, Japan, India, South Korea and the United Kingdom would take similar action.
The president is hoping to show that he is in control before the midterm elections in November. Higher petrol prices in recent months have become one of his political challenges. A recent study by the Progressive Think Tank shows that progress data shows that As petrol prices rose, so did Python’s ‘denial ratings’. Currently, 52.2 percent of Americans do not agree with his policies, the highest number since his inauguration in January, with 53 percent of Americans approving of his policies.
Biden wants to tap 50 million barrels. The salt caves in Texas and Louisiana in the United States have about 604 million barrels in reserve. These are usually used only in emergencies, for example when hurricanes disrupt supplies, but in recent years they have been used from time to time to reduce prices.
OPEC + says no
In addition, the president pressured the oil cartel OPEC and its allies to bring more oil to market, but to no avail. The cartel company decided to reduce production during the Corona period. Although it has increased slowly in recent months, countries have not yet produced at full capacity. Especially now that the number of corona infections is rising again they do not want to run the risk of producing too much oil. Along with global demand, it keeps prices high.
Experts say Biden may be trying to change the mindset of OPEC +. The White House announcement initially caused oil prices to fall by about half a dollar, but prices returned relatively quickly. At 1:30 pm, Brent oil traded at $ 79.90 a barrel, up from $ 79.10 just before the announcement of the decision to release a portion of US oil reserves.
“Passionate analyst. Thinker. Devoted twitter evangelist. Wannabe music specialist.”