Congress has mandated the sale of 147 million barrels of oil in the 2024-27 period to pay for infrastructure and other spending but now those sales could be reversed.
The Biden administration is seeking to cancel or delay those plans, which start with 35 million barrels in 2024.
It will be interesting to see where the oil market stands at that time but with prices at $81 now, China offline and producers showing discipline, I have a hard time seeing how they’re going to refill the reserve. As for this, the pace of sales was so slow that it’s hard to say it will make a difference. This is 35 million barrels a year in a market that uses 100 million barrels per day.