The United States announced that it will release 50 million barrels of oil from its strategic reserves, in a coordinated move with China, India, South Korea, Japan and the United Kingdom to cool prices after OPEC + producers rejected requests to raise pumping.
The White House issued the statement after a government source said Washington had been working out a plan with major Asian energy consumers to cut prices from nearly three-year highs. Britain had not been mentioned before.
US President Joe Biden, facing low approval ratings amid rising inflation, has repeatedly called on the Organization of the Petroleum Exporting Countries and its allies, a group known as OPEC +, to extract more oil.
But the group has rejected the requests as members seek to meet their existing targets for production increases and fear that a resurgence of coronavirus cases will once again undermine demand.
The liberation of the Strategic Petroleum Reserve of the United States would be carried out in the form of a sale on loan to companies, which must return the crude.
It is the first time the United States has coordinated a reserve release with some of the world’s largest oil consumers, local officials said.
The OPEC + members will meet on December 2 to discuss their production policy, but they have shown no signs of any change of course to fulfill Washington’s orders. A source in the group said that a release of the reserves would complicate the mathematics of the group, which monitors the market on a monthly basis.
Suhail Al-Mazrouei, Energy Minister of the United Arab Emirates, one of OPEC’s largest producers, said early Tuesday that he did not see “logic”In increasing the country’s supply to global markets.
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