Ive here. This new OilPrice post points to a point oil analysts have made elsewhere that pumping oil from the Strategic Petroleum Reserve is bullish on oil in the medium term because inventories must be replenished, which means more buying ahead.

However, the important additional information provided is that Biden’s plan to increase shale gas production levels in six months, the time when the SPR release is set to ens, seems to be only hope. A shortage of key materials for fracking machines will limit their ability to increase production.

But despite Biden’s claims, the U.S. may not have placed an embargo on Russian oil.reader glass hammer Point to the latest EIA report. Please note the Russian line, supply is still on the week of March 25th, When Biden imposed the so-called ban on March 8:

Take a close look at the table. Russia is listed in 8th place, as the title explains: “Ranking based on 2020 monthly oil supply data”.

However, if you look at national supply for the week of March 25, Russia was actually the sixth-ranked source, so at least that week, Russia was more important to the U.S. than it was for the same month in 2020. Russian officials mocked the United States for this.

Now, this may be the product of delivery, with the U.S. winking and nodding at the goods signed before the Biden embargo began. But it could be that the embargo operates on the basis of an honor system and not everyone follows it. Indirect confirmation comes from this Telegraph India article: Tankers with Russian oil barrels lose buyers:

This month, a tanker full of 1 million barrels of Russian oil set sail from Murmansk for Philadelphia. Then, in the mid-Atlantic, it made a sudden U-turn.

The ship, the Beijing Spirit, has apparently lost a buyer for the oil. According to MarineTraffic, a global maritime data provider, it removed “Philadelphia” as its listed destination and listed its new destination as “For Orders,” suggesting that the oil on board is being sold…

“Once you put crude oil in some tank on land, it’s anonymous,” MVan Schail said. “You blend it with other crudes, load it on another tanker, and sell it as a European acid blend, and no one knows it’s from Russia.” Meanwhile, the U.S. ban on Russian oil was announced on April 21. At least seven tankers are still heading for the U.S. to unload their cargo before the date comes into full effect.

So the embargo is not very strict. But as other sources have pointed out, the sale of oil in storage is not subject to the embargo. Therefore, traders can buy, pick up, and then resell. There will be intermediary costs, but the sales discount for Russian crude is big enough that it could be an attractive game, even before taking into account the direction in which prices may rise during any storage/washing period.

By: Irina Slav, a writer for Oilprice.com with over a decade of writing experience in the oil and gas industry.Originally Posted in oil price

This week, the Biden administration revealed that it would release As much as 180 million barrels of crude oil to calm oil prices, which have remained above $100 a barrel for a long time. Meanwhile, the International Energy Agency is coordinating the release of a smaller but international reserve of about 60 million barrels and has held an emergency meeting to discuss how it will be implemented.

it still exists not clear Will part of the 180 SPR released in the US be a completely separate effort, or will some of these barrels be part of the IEA release.Earlier this year, the United States had agree As part of the IEA push, 30 million barrels of oil will be released. Clearly, these releases have little chance of success in calming oil prices.

United States last year Announce The release of 50 million barrels of oil to keep prices down has weakened Americans’ purchasing power and hurt the president’s approval ratings.

this pressure price They have rallied a few days before the rally, driven by continued discipline from U.S. producers, equal discipline from OPEC+ and growing demand for commodities.

Then Russia invaded Ukraine and the U.S. banned imports of Russian crude oil and fuel. It also severely sanctioned the country’s financial system, making paying for Russian crude and fuel too much of a headache for the dollar-based international industry. Prices surged again before pulling back, but remained in the triple-digit range.

About 30 million barrels of crude oil in the Strategic Petroleum Reserve had been sold or leased as of mid-March, the U.S. Department of Energy said. That’s more than half the 50 million barrels announced in November and appears to have had zero impact on price movements.

But the new reserve release is much bigger, so it should make a difference, no? According to reports on the White House’s plans in this regard, this is about 1 million bpd in a few months. Unfortunately, but importantly, oil’s fundamentals haven’t changed much since November.

U.S. shale producers, the company that prompted analysts to talk a few years ago about OPEC becoming increasingly irrelevant, have rearranged their priorities. They are no longer striving for growth at all costs. Now they fight for happy shareholders.

This gives more opportunity Keeping small independent drillers with no shareholders happy. However, these have also encountered challenges, mainly in the form of a lack of capital, as the energy transition has banks worrying about their reputation and their own shareholders.

Pandemic-related supply disruptions have also affected the U.S. oil industry’s ability to expand production. Frac sand, cement and equipment are reportedly in short supply in shale plays.Now, there is a shortage Steel pipes, too.

Meanwhile, OPEC is business as usual, sticking to its pledge to add about 400,000 bpd to the oil market each month until its total output returns to pre-pandemic levels.Just this week, the cartel officially recognized Combined production rose by 432,000 b/d per month despite increasingly urgent calls from the US and the IEA to increase oil production.

OPEC has become increasingly vocal that its interests may currently be at odds with those of some of its biggest clients. It has refused to publicly condemn Russia’s actions in Ukraine, nor has it joined Western sanctions.

Instead, OPEC is happy to do business with Russia. Saudi Arabia and the United Arab Emirates, two OPEC members that actually have the ability to raise output beyond quotas, believe it would be unwise to undermine the partnership with Russia by acquiescing to Western demands for more oil.

In this environment, the release of any number of barrels from the strategic reserve would only provide very brief relief at the pump. Then, it might make things worse. As one oil market commentator on Twitter said about the SPR release, the White House will sell the barrels for $100 and then may have to buy them for $150.

In fact, one thing that is often overlooked in times of turmoil is that any country’s strategic oil reserves need to be replenished. This is not called strategy for laughing. The release of 180 million barrels of reserves would have a considerable impact on the US SPR, which currently exceeds 580 million barrels. If the fundamentals of oil remain the same, then when the time comes to replenish the SPR, the price will not be lower.

This seems to be the most likely development. The European Union, Britain and the United States have said sanctions against Russia will not be lifted even if Moscow reaches a peace deal with the Ukrainian government. That means people who trade in dollars or euros will continue to have difficulty accessing Russian oil.

according to International Energy Agency, the shortage could be 3 million barrels per day, which will be felt this quarter. OPEC+ is not on track.in some good newsAt the very least, U.S. oil production rose last week by 100,000 barrels per day for the first time in more than two months.