Roscoe747 wrote: scienceguy36 wrote: https://markets.businessinsider.com/news/commodities/us-crude-oil-profit-strategic-petroleum-reserve-releases-crude-joe-biden-2022-12
Will this strategy be used going forward with succesive administrations using this stategy to control the price of oil?
Its more a gimmick for the midterms at this point but it may be utilised again although a cynic will presume not till the 2024 election cycle. The front month futures is still in contango but 2 - 3 months out it has returned to backwardation.
The SPR needs refilling, Oil inventories are stable but a little under the 5 year average. The Euros pulled off a remarkable storage achievement but started at 60% or so. In 2023, they will start much lower without Ruzzian oil and gas.
China may come roaring back, OPEC cant meet quotas, US shale will not return to drilling for the sake of drilling for many reasons and Iran is still Iran. Russian sanctions are starting to bite. Travellers are anxious to travel and large pickups and SUVs are still the ride of choice.
The effects of 7 years of undercapitalisation will show in 2023 because there is no quick fix to it. Any supply disruption or increased demand can only be met with higher prices, not more supply. The structural bull market in oil is still in place and GXE can weather this correction with ease.
I loaded up at a loony. Although the stock may not be at the bottom yet, its okay for me.