The United States opens its strategic oil reserve to curb the escalation of inflation

The Ukraine war is also being waged in commodity trading halls

gas stations.

In an unprecedented move, the United States has decided to inject around

unrefined oil from its strategic reserve into the market over the next six months, at an average rate of one million per day (158.99 million liters which, if it were water, would be equivalent to more than 60 Olympic swimming pools).

That's more than 1% of global crude oil demand, which means that between now and the fall, more than 30% of US crude reserves will be sent to refineries to be processed into gasoline and other derivatives.

The Strategic Petroleum Reserve of the United States is made up of a series of caves next to the Gulf of Mexico, where the refineries of that country are concentrated.

The move has clearly achieved its main objective, which was to catch the market by surprise and

.

Thus, after the confirmation of the news, the barrel of

, which is the world reference oil, fell by 4.4%, and that of

, which is used in the US, by 4%.

The Joe Biden government wants to stop the spiral of prices in which the US has entered along with the rest of the world due to both the bottlenecks caused by Covid-19 in the global supply chain and the exit from the world market of oil of approximately two and a half million of Russian production.

The problem has been aggravated by the refusal of OPEC +, which is the cartel of large exporters, including Russia, to significantly increase crude oil production.

That group planned to increase production by

and, after the Russian invasion of Ukraine and the sanctions on Moscow, has raised that amount by a minuscule 36,000 barrels, something like 0.45% of global oil demand. .

Still, the decision is not going to be a magic wand that solves the world's oil and gas shortage problems.

The crude -that is, unrefined oil- from the Reserve is sour, which means that it has a high sulfur content.

On the one hand, that allows it to be used as a substitute for Russian oil.

But, at the same time, its refining is an expensive process, in which energy generated by natural gas is frequently used, whose price is at record highs.

In addition, the spent oil must be replaced in 2023, which, according to Goldman Sachs, will cause the opening of the Reserve to reduce the price by 15 dollars this year but increase it by 5 next year.

Biden's plan

Biden's plan is to combine the opening of the Reserve with two other measures that the United States is working on, although they do not depend on that country.

The first would be a release of more crude reserves by other industrialized countries, something Washington has asked the International Energy Agency to coordinate.

The second decision is an agreement between seven major powers - the US, China, Russia, Great Britain, Germany, France and the EU - to allow Iran to develop its nuclear program, which would allow the sanctions that the Donald Trump government imposed on Iran to be lifted. That country.

The White House's bet is that these oil reserves serve as a 'bridge' until at the end of the year Iran, free of sanctions, can contribute more than half a million barrels a day, and the US producers that use the technique of extraction known as 'fracking' add another million more.

But the US initiative is not the only one on the energy front of the Ukraine war.

Russia is selling oil of the type known as the Urals to India at a discount of $35 a barrel from its pre-war price.

That means a reduction of 36% with respect to the 'spot' price, that is, immediate delivery, of that crude.

Thus, India could receive crude from the Urals at about 60 dollars a barrel, when the current price is 95. Even with this reduction, the sale would be beneficial for Russia, since in that country's budget starting this year a Ural crude oil price of 44 dollars.

The biggest problem is, once again, the high sulfur content of this product, for which the Indian refining plants are not prepared.

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Know more

• United States

Growth The Bank of Spain warns of a "significant loss of GDP" due to the war, which will delay the recovery

FuelsThe big energy 'traders' warn that the crisis in Ukraine could force diesel to be rationed

Environment Global CO2 emissions set a new record in 2021

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