Oil prices fall as U.S. considers record reserves release

A pumpjack brings oil to the surface in the Monterey Shale, California, U.S. April 29, 2013. (Reuters photo)

SULAIMANI (ESTA) — Oil prices plunged on Thursday on news that the United States was considering the release of up to 180 million barrels from its strategic petroleum reserve, the largest in the near 50-year history of the SPR.

Brent crude futures fell $4.24 to $109.2 a barrel by 0735 GMT.

U.S. West Texas Intermediate futures delivery fell $4.84 to $103 a barrel after touching a low of $100.85.

U.S. President Joe Biden will give remarks later on Thursday regarding his administration’s actions aimed at lowering gasoline prices that have risen to record highs since Russia began its invasion of Ukraine, according to Reuters.

Such a release would help the oil market to rebalance in 2022 by increasing supply by 1 million barrels per day (bpd) for six months, Reuters cited Goldman Sachs analysts as saying in a note.

“This would remain, however, a release of oil inventories, not a persistent source of supply for coming years. Such a release would therefore not resolve the structural supply deficit, years in the making.”

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