AGI – The price of the WTI, the US barrel of reference, is under pressure on the rumors according to which Washington has proposed to other oil-consuming countries such as China and Japan to consider a coordinated release of strategic oil reserves as a way to lower prices.
The US administration’s offer to shock markets comes as inflationary pressures, partly driven by rising energy prices, they start to get heavy while the world is recovering from the worst health crisis in a century.
Oil prices reduce mid-morning losses, but remain down after OPEC and the International Energy Agency warned of impending oversupply, while rising Covid cases in Europe have increased downside risks for closures that could hold back the recovery.
Meantime, China said it is moving to release its oil stocks following a Reuters report that the US was asking major consumer countries like China and Japan to consider a coordinated release of reserves to lower prices.
The WTI loses 0.43% to 77.93 dollars a barrel, the Brent drops 0.24% to 80.09 dollars a barrel.
In October, prices had peaked in seven years: this is because demand grew rapidly while Opec + decided to increase production, but slowly. For the Biden administration, this is not enough to keep prices under control.
The Chinese position
The Chinese administration has made it known that will begin to release crude oil reserves: a move that aims to lower prices. Just a few hours earlier, according to rumors, the United States had suggested “coordinated” action in this regard to the major oil-consuming countries, including China. However, Beijing refused to comment on the US request.
Biden calls for controls on soaring prices
US President Joe Biden has asked the Federal Trade Commission (FTC) to investigate the possibility of anti-competitive or “illegal” conduct by US oil and gas companies. Already in August, the US president had asked the FTC to investigate on possible illegal conducts that cause gas prices to soar. According to Biden, further action is needed as prices continued to rise.
“I don’t accept Americans who work hard pay more for gas due to anti-competitive conduct or otherwise potentially illegal, “Biden said in a letter to FTC president Lina Khan.” I therefore ask the Commission to further investigate what is happening in the oil and gas markets and use all tools to uncover any wrongdoing. ” , the president said.
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