The White House fact sheet said that Biden would call on Congress to approve legislation that would “make companies pay fees on wells from their leases that they haven’t used in years and on acres of public lands that they are hoarding without producing.”
The senior administration official described it as a “use it or lose it” policy.
Such legislation, however, would face high hurdles given Democrats’ extremely slim majorities in Congress and the Senate’s 60-vote threshold for most votes.
The White House also said that Biden would authorize the use of the Defense Production Act to support the production and processing of minerals for batteries used in clean energy and electric vehicles, part of an effort to transition the U.S. to clean energy overtime and reduce dependence on oil.
Read more: https://thehill.com/policy/energy-envir ... 0idzmEyEne
Old Joe doesn't seem to know what to do - Apr 1
Old Joe doesn't seem to know what to do - Apr 1
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Old Joe doesn't seem to know what to do - Apr 1
3 takeaways from Biden’s energy plan. E&E News.
President Biden’s plan yesterday to release a historic amount of oil from the Strategic Petroleum Reserve and boost mining for critical minerals helped push down the price of crude, but also drew pushback from entities ranging from the U.S. oil and gas industry to wildlife protection groups. The plan also left unanswered questions about whether it would reach its intended goals, affect emissions, and change the trajectory of the oil and mining industries over the long term.
Biden to tap oil reserves, press oil sector to hike production. Politico Pro.
President Joe Biden will order the release of 1 million barrels of oil per day from the nation's strategic reserves and urge Congress to press the oil industry to increase drilling on federal lands in bid to tame high gasoline prices. The move is the latest attempt by the White House and Democrats to temper the volatile oil markets that drove gasoline prices to all-time highs in the weeks since Russia invaded Ukraine. Those skyrocketing prices and the inflation they have fanned sparked criticism from voters ahead of the mid-term elections in November.
Energy industry slams Biden's Strategic Petroleum Reserve release plan: 'Not a long-term solution'. Fox Business.
Energy industry representatives Thursday slammed President Biden's plan to release one million barrels of oil per day from the Strategic Petroleum Reserve as short-sighted amid other policies that discourage production. "While this release could provide some near-term relief, it is not a long-term solution to meeting growing demand for affordable and reliable energy," said Frank Macchiarola, American Petroleum Institute's senior vice president of policy, economics, and regulatory affairs. "Instead of managing from crisis to crisis, we should be focused on promoting policies that avoid them altogether through increased production of our nation’s domestic energy resources."
OPEC+ sticks to modest oil supply increase despite high prices. The Hill.
A group of oil exporting countries known as OPEC+ agreed to stick to a modest supply increase despite high prices linked to Russia’s invasion of Ukraine. OPEC+, which includes Russia as well as countries including Saudi Arabia and the United Arab Emirates, agreed to increase supply by just 432,000 barrels per day as the group slowly responds to coronavirus-linked demand cuts. Their move comes as the price of oil from many countries has skyrocketed following Russia’s invasion of Ukraine. Note: CNBC also reports.
MY TAKE:
1. OPEC+ has very little additional oil supply that it can bring to market. The cartel's production has been under their quotas for five months in a row.
2. The SPR oil release will not push oil under $100/bbl for long. U.S. demand for heavy crude is much higher than current supply and demand will go up by over a million bpd in Q2.
3. The majority of voters know that Old Joe is doing this for political reasons in the hope it will keep gasoline prices from going higher. Democrats will do everything in the playbook to blame others for inflation.
4. The sanctions against Russia have not even started to impact physical supply.
5. Post-Pandemic World is short oil and global demand goes up 1.5 to 2.5 million bpd every year.
Conclusion: Goldman Sachs' forecast of $125/bbl Brent within a few months may be too low.
President Biden’s plan yesterday to release a historic amount of oil from the Strategic Petroleum Reserve and boost mining for critical minerals helped push down the price of crude, but also drew pushback from entities ranging from the U.S. oil and gas industry to wildlife protection groups. The plan also left unanswered questions about whether it would reach its intended goals, affect emissions, and change the trajectory of the oil and mining industries over the long term.
Biden to tap oil reserves, press oil sector to hike production. Politico Pro.
President Joe Biden will order the release of 1 million barrels of oil per day from the nation's strategic reserves and urge Congress to press the oil industry to increase drilling on federal lands in bid to tame high gasoline prices. The move is the latest attempt by the White House and Democrats to temper the volatile oil markets that drove gasoline prices to all-time highs in the weeks since Russia invaded Ukraine. Those skyrocketing prices and the inflation they have fanned sparked criticism from voters ahead of the mid-term elections in November.
Energy industry slams Biden's Strategic Petroleum Reserve release plan: 'Not a long-term solution'. Fox Business.
Energy industry representatives Thursday slammed President Biden's plan to release one million barrels of oil per day from the Strategic Petroleum Reserve as short-sighted amid other policies that discourage production. "While this release could provide some near-term relief, it is not a long-term solution to meeting growing demand for affordable and reliable energy," said Frank Macchiarola, American Petroleum Institute's senior vice president of policy, economics, and regulatory affairs. "Instead of managing from crisis to crisis, we should be focused on promoting policies that avoid them altogether through increased production of our nation’s domestic energy resources."
OPEC+ sticks to modest oil supply increase despite high prices. The Hill.
A group of oil exporting countries known as OPEC+ agreed to stick to a modest supply increase despite high prices linked to Russia’s invasion of Ukraine. OPEC+, which includes Russia as well as countries including Saudi Arabia and the United Arab Emirates, agreed to increase supply by just 432,000 barrels per day as the group slowly responds to coronavirus-linked demand cuts. Their move comes as the price of oil from many countries has skyrocketed following Russia’s invasion of Ukraine. Note: CNBC also reports.
MY TAKE:
1. OPEC+ has very little additional oil supply that it can bring to market. The cartel's production has been under their quotas for five months in a row.
2. The SPR oil release will not push oil under $100/bbl for long. U.S. demand for heavy crude is much higher than current supply and demand will go up by over a million bpd in Q2.
3. The majority of voters know that Old Joe is doing this for political reasons in the hope it will keep gasoline prices from going higher. Democrats will do everything in the playbook to blame others for inflation.
4. The sanctions against Russia have not even started to impact physical supply.
5. Post-Pandemic World is short oil and global demand goes up 1.5 to 2.5 million bpd every year.
Conclusion: Goldman Sachs' forecast of $125/bbl Brent within a few months may be too low.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Old Joe doesn't seem to know what to do - Apr 1
Also, Team Biden not aware that their plan may be physically impossible.
"Saad Rahim, Trafigura Group's Chief Economist told Bloomberg TV, that the potential SPR release will actually discourage future oil output and could drive forward prices higher and added that the US SPR is only capable of delivering 400,000 to 500,000 barrels a day of oil from the strategic reserve."
"Saad Rahim, Trafigura Group's Chief Economist told Bloomberg TV, that the potential SPR release will actually discourage future oil output and could drive forward prices higher and added that the US SPR is only capable of delivering 400,000 to 500,000 barrels a day of oil from the strategic reserve."
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Old Joe doesn't seem to know what to do - Apr 1
So, in reality, he is/was trying to manipulate the market. The press conference was held on the last day of the month and the quarter and 1/2 half hour before the futures market closed causing traders to dump positions
I expect oil to rise in April when people discover what a sham the plan is
I expect oil to rise in April when people discover what a sham the plan is
Re: Old Joe doesn't seem to know what to do - Apr 1
I honestly doubt that they even know it is a sham. Even with their approval rating in free fall, they cannot stop bashing the oil companies. They really need to shelve the Green New Deal BS.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: Old Joe doesn't seem to know what to do - Apr 1
They can't "shelve the Green New Deal bs" because their big donors will "defund" them. So, like trapped monkeys,
they won't release their grip on the peanuts in the trap and escape, instead will go down with the Green New Titanic.
Fighting through this fog of war and trying to figure out how to use it for gain/self preservation. Like Rahmbo says, "never let a crisis go to waste".
they won't release their grip on the peanuts in the trap and escape, instead will go down with the Green New Titanic.
Fighting through this fog of war and trying to figure out how to use it for gain/self preservation. Like Rahmbo says, "never let a crisis go to waste".
Re: Old Joe doesn't seem to know what to do - Apr 1
Looking at SPR withdrawals the past 6 months, and Daily Average was 261,640 bbl / day.
Even if Biden raises this to 1,000,000 / day, that is only an additional 738,360 bbl / day.
Not even 2 months of OPEC+ rise in production limits.
At the end of this 180 days, they won't be able to stop the withdrawals.
That will put the SPR below 350 million barrels by year end,
and possibly below 300 million.
Given that we have averaged 650 to 750 million in the SPR (ignoring 2020) since 2005,
such a huge drawdown will increase WTI volatility.
This is very dangerous and will do absolutely nothing to reduce crude prices beyond the next month at most.
Kevin
Even if Biden raises this to 1,000,000 / day, that is only an additional 738,360 bbl / day.
Not even 2 months of OPEC+ rise in production limits.
At the end of this 180 days, they won't be able to stop the withdrawals.
That will put the SPR below 350 million barrels by year end,
and possibly below 300 million.
Given that we have averaged 650 to 750 million in the SPR (ignoring 2020) since 2005,
such a huge drawdown will increase WTI volatility.
This is very dangerous and will do absolutely nothing to reduce crude prices beyond the next month at most.
Kevin