US President Joe Biden is assessing the benefits of using strategic oil reserves to lower gasoline prices.
Oil prices fell as investors thought the US and China could use strategic reserves in a coordinated manner. West Texas Oil slid 1.1 percent to its lowest level in six weeks. US President Joe Biden is assessing the benefits of using strategic oil reserves to lower gasoline prices.
At the online summit with Chinese President Xi Jinping this week, the US raised the possibility of using China’s reserves, the South China Morning Post reported. It was stated that Beijing is open to this idea but has not yet taken action on the issue. JPMorgan analysts say a coordinated reserve release is unlikely. Nevertheless, the expectation of coordinated action affects prices downwards.
“It’s clear that markets are preparing for a possible use of reserves, but I don’t think it will have much of an impact on prices given the volume,” said Daniel Hynes, Senior Market Analyst at Australia New Zealand Banking Group.
US President Joe Biden has instructed the Federal Trade Commission (FTC) to investigate whether fuel prices, which have risen more than 50 percent in recent months, are “anti-competitive” or “illegal practice”.
West Texas Intermediate for December delivery fell 1.1 percent to 77.50 a barrel on the Nymex market. Brent oil for January delivery fell 0.6 percent to $79.80 a barrel on the London ICE Futures Europe market.