kyiv.Ukraine.Ukraine Gate – November 22,2021- Oil prices are falling on expectations that the United States, China and Japan will start selling raw materials from strategic reserves (SPR) to lower energy prices and curb inflation on Monday, November 22.
The price of a barrel of Brent January oil at 9:15 in Kyiv was $ 78.61 (-0.35%). A barrel of January WTI oil traded at $ 75.81 (-0.1796%). Preliminary trading in the standards ended at $ 78.89 and $ 75.94, respectively.
Earlier it was reported that US President Joe Biden is considering selling oil from the Strategic Petroleum Reserve (SPR). Beijing is preparing a similar step.
Last weekend, the Japanese newspaper Yomiuri reported that Tokyo could make a joint statement with Washington on the issue next week.
Japanese law does not allow the sale of oil from reserves in order to reduce prices, however, according to the newspaper, the reserves of both the state and the private sector exceed the minimum required by law. The newspaper’s sources note that the country’s authorities are considering selling part of the excess reserves.
The combined release of SPR can be from 100 to 120 million bar. or even more, according to a November 19 Citi memo. The bank estimates that this volume includes from 45 to 60 million barrels. from the United States, about 30 million barrels. from China, 5 million bar. from India and 10 million bar. – from Japan and South Korea.
“In the case of (strategic oil) production in December and January, this could mean a weakening of markets by about 1.5-2.0 million barrels. per day. This will happen against the background of the expected inflow of reserves at 2.8 million bar. per day in December 2021 and 0.5 million bar. for the day in January 2022 without taking into account the release of SPR “, – said in Citi.
Meanwhile, the introduction of new quarantine restrictions in Europe shows that the growth rate of global oil demand may be slower than expected, and this leads some experts to doubt that the United States will still sell SPR raw materials.
