What is the United States looking for with its strategic oil reserves?
Earlier, OPEC and its allies had repeatedly rejected requests from Washington and several consuming countries to act more quickly to keep pace with rising market demand, IRNA reported on Tuesday, quoting Reuters.
US President Joe Biden has already faced a decline in popularity due to high fuel prices and other commodities in the country, which poses a threat to him and his party ahead of next year’s congressional election.
The official noted that the swap of US strategic oil reserves (SPR) will be announced in a coordinated action with several countries today.
The source did not say how much oil would be extracted from these reserves.
Biden has previously called on China, India, South Korea and Japan to withdraw their strategic oil reserves alongside the United States.
Japanese and Indian officials are working on ways to address this, Reuters reported.
The unprecedented US move to work with major Asian economies to lower energy prices serves as a warning to major oil producers that they need to inject more oil into markets to address concerns over high fuel prices in major economies. .
Members of OPEC and its allies, including Russia, are scheduled to meet on December 2 to discuss their production policies.
The impact of concerted action to extract these oil reserves by several countries depends on the timeline and quantity, but the withdrawal of more than 60 million barrels in about 30 days from a market perspective for Energy prices will be very negative.
As the end-of-year holidays approach, demand for gasoline has increased, and this, along with rising oil prices, has led to rising gasoline prices.
China also recently announced plans to withdraw from its oil reserves. The decision came after OPEC Plus members said they would not change the trend in increasing oil supply to the market.
Meanwhile, rising coronary heart disease in Europe has increased whispers of global quarantine in some Green Continent countries. An issue that could reduce oil demand and lower prices in this market.
It was also previously reported that the Japanese government had decided to withdraw its oil reserves at the request of the United States to help curb rising crude oil prices.
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