Oil producers cast doubt on Biden’s plan to replenish US reserves – WSJ (NYSEARCA:XLE)

Pumpjacks working at sunset

imageinima / E + via Getty Images

President Biden’s plan to replenish the US Strategic Petroleum Reserves in an effort to boost sluggish drilling will be difficult to sell to many domestic manufacturersindustry executives and analysts told Wall Street Magazine.

Biden revealed the plan last week for the U.S. Department of Energy to start buying oil for emergency stockpiling when oil prices are $67-$72/bbl or less, but many oil companies are wary of closing sales as the commodity markets Violent volatility, rising drilling costs and pressure from investors to limit production and return excess cash to shareholders are also dampening prospects for growth in domestic production, according to the report.


Surge Energy (OTCPK: ZPTAF) CEO Linhua Guan said to WSJ that Biden’s offer might make some people accept it, but the president’s other oil and gas policies – such as dramatically reducing new oil leases on federal lands – make investments new is not attractive.

Raymond James analyst Marshall Adkins said the prevailing view among producers that crude prices will continue to rise for the foreseeable future makes them less likely to pre-sell oil. to the extent that the supply gap could push crude oil prices to $120/bbl or higher.

“If I think the price of oil is going to be a lot higher a year from now, then I don’t have a barrier at $70,” he said.

Some analysts also say the shift from releasing reserves to refilling could remove large amounts of oil from the global market, further tightening supply and contributing to inflation.

The Biden administration reacted angrily to OPEC+’s recent decision to cut oil production, saying the US is “reassess” its relationship with Saudi Arabia.


News7F: Update the world's latest breaking news online of the day, breaking news, politics, society today, international mainstream news .Updated news 24/7: Entertainment, the World everyday world. Hot news, images, video clips that are updated quickly and reliably

Related Articles

Back to top button