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DOE Announces Details Of Strategic Petroleum Reserve Firesale
Following the earlier general announcement that the SPR would sell 30 MM barrels of oil a lot of questions were left unanswered, such as what kind of crude will be sold, where will it be sold from, and at what price. The wait for answers is now over: The DOE has just released all the missing data. Per Reuters: "Under the terms of the U.S. sale that were issued by the department, the government does not plan to stagger the sale of the oil and will offer all 30 million barrels in one bid sale. The department will offer "sweet" crude oil from three of the reserve's storage sites: Bryan Mound and Big Hill in Texas and West Hackberry in Louisiana. The oil will have a base price of $112.78 a barrel, a spokeswoman for the SPR said." Which does not however mean that this is the price at which the oil will be sold: "Traders can bid above or below the "Base Reference Price" of $112.78, which is derived from the last five days of trading of Light Louisiana Sweet crude oil, as assessed by energy pricing agency Argus. Companies will submit their bids for the oil through a special department website. Delivery of the oil to the winning companies would take place over the month of August. Winning companies would pay for their oil during the month after the crude is delivered." Which simply means that China will convert quite a bit of America's trade deficit from dollars into oil.
And as a reminder, here is why China, which is now actively filling up its own SPR, couldn't be happier about this development. From Zero Hedge March 7. Paraphrasing from Dow Jones:
China
will start work on building strategic oil reserve tanks at the
north-eastern port of Tianjin by May, China Daily newspaper reported
Saturday.Work will be completed before the end of China's
2011-2015 five-year economic plan, and filling this reserve will start
when the oil price is "appropriate", Tianjin city official He Shushan
was quoted as saying.China's efforts to build up oil stocks are
closely watched by energy market analysts, as its demand for oil is a
key driver of global prices and huge amounts of crude are needed for the
project. China imports more than half the oil it uses.The
reserve site in Tianjin is among eight stockpiling bases being prepared
in the second phase of China's strategic petroleum reserve project.These
eight sites will have 26.8 million cubic meters of capacity, able to
store the equivalent of 169 million barrels of crude oil.The
western countries' energy watchdog, the International Energy Agency, has
repeatedly criticized Beijing for not publishing national oil stock
volume figures, which are needed to calculate global oil demand.Sites
for other second-phase bases include Zhanjiang and Huizhou in Guangdong
province, Lanzhou in Gansu province, and Jintan and Jinzhou in Liaoning
province.China's petroleum reserve capacity was enough for 39
days of consumption by the end of 2010, with this comprising the SPR oil
and a further 168 million barrels of commercial reserve capacity, state
energy giant China National Petroleum Corp. said in January.
It is not only China: all of Asia is taking the prudent step of preparing for a very long storm. From the FT:
As
oil prices spiral higher amid turmoil in Libya, developing countries
across Asia are taking evasive action, shoring up their strategic
petroleum reserves against the risk of a prolonged supply shock. Their
actions could propel crude even higher.The Philippines, citing
events in the Middle East, announced on Wednesday that it would require
oil companies in the country to maintain 15 days of reserves, and
refineries to keep enough oil to last for 30 days.Manila’s move
is the most visible sign yet of how Asian countries are seeking to
improve their oil security amid what is shaping up to be the worst
supply crisis since the invasion of Iraq in 2003. Other big regional oil
importers are likely to follow suit.China is the world’s
second-largest oil importer after the US. India is the world’s
fifth-largest, ahead of countries such as South Korea, France and the
UK. But the pair lack a strategic petroleum reserve that can be tapped
during a supply crisis similar in size and scope to the ones held by
western countries.Unlike industrialised countries, which built
up their stockpiles three decades ago in the wake of the 1973 oil
crisis, China only recently began its strategic reserve programme,
starting to fill reserves in 2006 and completing a 102m barrel build-out
in “Phase One” two years later.The second phase of the programme will build a further 168m barrels of reserves by the beginning of next year.
When
China finishes filling its reserve, which it is expected to do by 2020,
it will hold about 500m barrels, equal to roughly three months of
imports and the second-largest stockpile in the world.China’s
strategic stockpiling “is likely to be a feature of the global oil
market not only this year but this decade”, says Soozhana Choi, head of
Asia commodities research at Deutsche Bank in Singapore.Although
purchases are kept secret, analysts and oil traders believe that events
in Libya and the prospect of further supply disruptions in the Middle
East could boost strategic buying of crude.“With
the expectation that prices are going to rise, they will accelerate the
pace of tank-filling,” says K.F. Yan, director at energy consultants
CERA in Beijing.
In other words, all of Asia thanks America's stupidity yet again, and specifially its service-based, oil hungry economy, which is about to proceed with the first of many fire sales of crude which will merely move from Point A (US) to Point B (somewhere in Asia).
Great work Obama. As always.
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What entity is "managing" this?
Wait a minute!
The Strategic Petroleum Reserve is meant to help the USA when there is a catastrophic supply disruption (ie. following Katrina). It was not structured nor intended to be for price manipulation to aid the economy by spurring consumer consumption. If this is to ease a "catastrophic" disruption, why is it not being delivered until August? And when is the bidding scheduled for?
It is a misappropriation by the IEA - driven by powers we are not "sure" of yet - but since 50% of the oil released is from the USA's SPR, you can be confident that our gov't/Treas/Fed was made aware of and influenced this decision in advance.
Does anyone believe the bidding won't be rigged and manipulated too? Wars start over these kind of things. As we prepare to exit Afghanistan we have another war heating up.
This will backfire!
It's probably just that either GS or JPM got caught on the wrong side of the crude futes market and needed a bail out.
No it was O'bama caught on the wrong side of a pending election! O'bama needs a voting bailout!
While you all are worried about oil, here's what's going on in the rest of the world:
Obummer is negotiating with the Taliban, and backing the Libyan rebels. So what? You need to see what your tax dollars are paying for yourself!
The Bad Guys
These videos look awfully like Al Qaeda to me. But don’t take my word for it. Look at the evidence and decide for yourself.
A warning: these videos are graphic and horrific. They’re posted at obamaslibya.com and FederalJack.com, because it’s got hefty security around its site and rock solid courage to speak truth to power.
FederalJack will not back down, and will update the videos on obamaslibya.com as new footage arrives.
The first video shows a Libyan rebel beheading a Libyan soldier. If it looks like Iraq, well golly, the highest percentage of foreign fighters in Iraq (and Chechnya and Afghanistan) came from Eastern Libya. Unhappily for NATO, there’s no avoiding that this video was shot in Libya: The men are speaking a Libyan Arab dialect with its own distinct accent.
The second video shows gruesome footage of a Libyan rebel cutting up the rotted flesh of a dead soldier and forcing it into the hands of Libyan Prisoners of War, who are lined up in a row so they must eat it.
Another video shows a group of Rebels sodomizing a civilian with a pistol.
Another shows a crowd of Rebels hanging and beheading a Libyan soldier.
Another video shows CIA operatives working side by side Rebel forces, driving around in trucks— proof that U.S. forces are already on the ground and active participants in the atrocities.
Another video shows several dead Libyan soldiers with their throats cut, lying in the back of a truck. The killings violate the Geneva Conventions of War, which protect enemy soldiers after capture. In the excitement, NATO Rebels encouraged a frightened on-looker to video the butchery and claim that Gadhaffi’s forces were responsible. Afterward, the man with the video grabbed his family and fled the Rebel stronghold. That’s how the video reached the fact-finding group in Tripoli
I wasn't "worried" about oil so much as about the manipulated markets, now further manipulated and additional markets, goverments and entities.
Your post is annoying in its context here. A worthy post, but you are stretching to put here. Just saying.
I bet it is both.
I think I understand; it's all part of the strategy of "winning the future"; they next thing to do is lower the painter over the rail on his scaffold and paint over the "TITANIC"with, "Hope and Change"; then everything will be fixed.
am sure this is all covered in the constitution!
Does it mean they admit that USA is in catastrophic condition?
- not til August, then the USA will be in a catastophic condition.
I agree, catastrophic August appears to be signaled.
backfire? this reeks of sabotage.
Mad Max bitchez.
TPTB => TPTW => TPTNCR (The powers that nobody can remember).
The two great northern tribes went to war, over the black fuel...
http://www.youtube.com/watch?v=Ll-4MOB2pvY
The IEA released a mock Q&A today to address questions re: the SPR release. In this Q&A was a bit of shocker in that they openly acknowledged that Saudi Arabia does not have the famed spare capacity and spigot they can turn on as needed that every main stream media outlet and WS analyst claims that they do. In fact, the release is a tacit admission of the fact that Saudi Arabia has little to no spare capacity. Matthew Simmons was right all along... This whole manuever is bullish for crude and exposes the tightness in the market.
Has the IEA consulted with OPEC or Saudi Arabia on this decision? Would this IEA action not discourage Saudi Arabia and other willing OPEC members from increasing oil production?
The IEA and its member countries have been in close contact with key oil producing countries, and in particularly with Saudi Arabia, which holds the lion’s share of OPEC’s spare capacity. The IEA welcomes the announcement made by Saudi Arabia that it intends to make incremental oil available to the market. However it will take time for these incremental barrels to be produced and shipped to consuming markets; the use of IEA strategic stocks now will help bridge the gap until these new supplies are available. Producers and consumers have a common interest in stabilising oil markets. This point has been highlighted many times before, and is a reason for the IEA’s close liaison with key oil producing countries at all times.
http://blogs.forbes.com/christopherhelman/2011/06/23/obama-taps-petroleu...
http://en.rian.ru/business/20110623/164798920.html
Goodbye U.S. Dollar!
The sooner it happens the better off the survivors will be. Beans, Bullets, and Bullion Bitchez!
Groceries , Guns, and Gold!
Pasta, Pistols, PM's, Putas!
Doomers, goons and rednecks
Saddle up the Camaros, pilgrims. This redneck done got mad....
You hurt my feelings. I'm going to stop buying precious metals and guns because I haven't the self esteem to oppose the oligarchs. You're unstoppable like AAPL!
Sir Gavrikon: Obviously, whoever junked you is not familiar with your top-notch comments on MW blogs.
You Sir, deserve your due....
Apologize for the idiot who junked you. He knows not what he does.
200% Silver ! (Margin loans are cheap!)
That's the 12th country with a yuan swap agreement
These people are retarded.
No; these 'people' are politicians. Please do not degrade the mentally handicapped.
I say FUCKTARDS. Our govt is a bunch of FUCKTARDS
Seeing as how it came from the feds.......how believable is the info? Something else is going on.....
True. But who elected them? Nothing spells F.U.C.K.T.A.R.D.A.G.E. like:
a) The scientifically illiterate, "we got enough oil in Alaska to last us a thousand years," Lindsey Williams parrots.
b) The psychotic, shaven-head, drum-beating Hare "abiotic oil" Krishnas.
So how much did GS make trading in front of this "surprise"?
What a silly frivolous foolish bumbling -- and above all DANGEROUS -- Government we have.
They are worse than a Banana Republic. Think Kafka or Borges. Obviously Orwell.
I think they've stumbled right into Harold Pinter levels of absurdity.
indeed
another little ancillary market benefit that will come from this down the road will be how the market will be 'surprised" to see how the oil inventories have declined and will surely see it as a bullish sign to send the markets ever needlessly higher because....well...just because.
I think if I live long enough to see even one smart decision made in Washington that actually benefits the people of America...I'd probably drop dead of a heart attack on the spot.
If SS and Medicare were bad ideas the (D) and (R)'s would make them go away!!!!!!
They must be good ideas or why are they still defended?
/s
Because lobbyists need to drain energy through their dangly filcher pods too?
Obama is privatizing the strategic petroleum reserve because of the debt ceiling.
How desparate for cash!
Next up for sale, the Lincoln Memorial.
Good analysis, except I wouldn't say "Obama".
Like W before him, he is a rubber-stamper and dancing puppet for decisions made by... a higher power...
-William Jefferson Clinton, 1998, here
(a lot of truth is said in jest)
Hillary?
One good turn deserves another, hope this gives you a chuckle:
http://i.imgur.com/6JIYy.jpg
Considering the number of persons Lincoln murdered in a civil war simply because some states had had enough of an overbearing central government and wanted to legally leave the union. The Lincolin Memorial should be sold for scrap.
Here we go again. They did legally leave the union. After they left the Union they ganged up on the Union and attacked it at Fort Sumter. The Union then defended itself and the rest is history.
So let me get this straight, the administration that refuses to approve oil drilling permits all over the US is now selling our Strategic Petroleum Reserves to China.
Let me dwell on this for a bit...
Cdad, I'm glad you you're here on ZH, i like the way you think.
Well, I have thought about it for awhile now, and I have decided that even a HUGE FAN of Dancin' with the Stars can see how absurd this one is.
As was Rome, so too are we being destroyed from within.
And the winning bid is Walter Himmel, a New Jersey dentist, who says he’s been successfully trading (er investing) in oil on margin for over three years.
There, that’ll show those damn speculators what for.
I guess I don't get how $113/barrel oil is that helpful, anyway.
This is the dirty little secret or oil and reporting WTI as the measure.
We don't burn much WTI. We burn imports mostly. They are all priced higher. The avg was about $113.
How dumb are we as a civilization?
We drill oil out of the ground, than pump it back into the ground, pump it back out of the ground, and someone else pumps it back into the ground?
I have no faith in humanity at all.
On the same note, we have clearly demonstrated our inability to handle nuclear energy responsibly. What are we doing with CERN? They are trying to make black holes and antimatter? Really?
.....befuddled.
The depravity of the human condition ad infinitum.
You have made it over complicated. The real sequence is:
We pump oil out of the ground, and then we burn it. And then it's gone.
Forever.
No I haven't over complicated it.
We pumped oil out of the ground....pumped it into the ground into our reserves....now we are pumping oil out of the reserves.....now China is pumping oil into their reserves.
This seems like unnecessary folly.
You're right; China is soon to bypass the uselss middleman. China buys assets with sovereign wealth fund and pumps oil out of the ground and transports to China.... Superficial USA is bypassed.
You make an excellent (yet blatantly obvious) point that seems to escape the minds of so many. Crude oil is not a renewable resource and production of it has peaked worldwide. And, once burned is gone forever. We burn 89 million barrels a day--it's the life blood of our economy. And, China's per capita use of crude oil is roughly 15% that of modernized countries. China is marching faster and faster to that higher standard of living that most others in the world take for granted.
Excuse me, but I thought the problem with oil prices is an array of speculators performing evil deeds that DOJ is going to prosecute, thereby solving the issue, and I thought this was asserted in the same breath that "there is no supply problem and the world is awash in oil" was uttered.
And wait a minute rev 2.0, I thought the Saudis were going to solve this problem.
This looks rather a lot like trying to fix a supply problem.
This is a repost from my comment this morning:
So the EIA is going to release less than 2/3rds of one days world crude demand over time?
Another ridiculous policy response. Fucking politicians trying to get reelected by once again demonstrating the wrong answer to the wrong question.
When the hedge fund community is structurally long over 300m/boe (WTI+brent) which amounts to 30% of OECD stocks, up from a mere 30m/boe at the high in 2006, one can only speculate (pun intended) about what the real issue and correct policy response it.
These numbers are from the CFTC and are as of last week. They are down from the high reached on April 26 which was 445m/boe (WTI+brent), but in absolute terms last weeks number was STILL HIGHER than at anytime before December 2010.
The problem is not SUPPLY. The problem is monetary policy and treating crude oil as an asset class. Alas as long as one doesn't correctly define the problem, the correct solution will never see the light of day.
This is profoundly true...and also the point of the exercise. Whether we are talking about bonds, equities, or commodities, our "markets" have been destroyed. This is not an accident. Our markets have been systematically destroyed for many months now, each actor taking his turn upon the stage.
Tell me, how was today's one two punch of SPR oil and "Greece is fixed" supposed to create a basis for investing? It doesn't. It brings out guys with charts, computers that can scalp those charts, and funds flowing from the ever benevolent Federal Reserve.
When you step back and look at the totality of it all, including the fact that Obama has damaged the our ability to produce oil, and the Fed's attack on our currency, the picture of failure is quite plain to see...which again, is the purpose of the exercise.
You should anticipate heavy volume liquidation selling in the very near term.
Don't know if you understand why you're right or not.
Oil is indeed not an asset class. It is a consumable. Once you pump it out of the ground and burn it, it's gone. Forever.
That's not an asset class. That's lifeblood.
Oil is paper or an entry in a computer so yes, it is an asset class. The real world you describe ceased to exist many decades ago.
You are becoming one of my favorite posters.
Long futures. So due to rolling, they can be basically be perpetually long without seeing a single drip drop of oil.
I have heard of a big non-oil entity (or 3..) being long actual crude stored in a tanker, but i digress.
Liz, the first critical lesson to learn about oil is that BOE is not BO. Oil equivalent is not oil. You can't put natural gas in a 450 hp John Deere tractor and plow 10,000 acres.
Crude + Condensate, and even condensate is bogus because it doesn't have oil's energy density.
Be very careful of numbers. Definitions have changed to conceal the crude totals. You'll see C&C, you'll see boe, you'll see "all liquids".
That's all just methodology to conceal oil getting scarce.
There IS a supply problem. When you look at numbers, look at Brent. Not WTI.
My understanding of economics 101 is that supply problems are price problems. If supply does not meet demand, the price must be too low. In a free,efficient market, the price cannot be too low, because it rises in concert with the demand/supply ratio.
In WWII, due to shortages/rationing of oil, companies built and sold wood->gas converters for automobiles. They weren't cheap, but they were cheap relative to the price of oil.
So if there really is a supply problem in oil, then it appears that the market for oil is neither free, not efficient (but particularly not free). Even this closed auction of SPR reserves is simply an attempt at price fixing.
You junk me??? Seriously??? For a comment about supply and demand???
LOL, made of fail.
Be seeing the White House silverware and serving sets on Craigslist next.
qe3 light sweet baby....
U.S. Taps Strategic Petroleum Reserve
What's the plan for a hurricane strike on the gulf coast?
I've heard about angels about to play their HAARP.
Cash for oil. Err, I mean gold. Gold.
http://fliiby.com/file/558332/uh2zmdswjq.html
The gold medallion bit cracks me up.
Question 1/- If a country "A" uses 18 million barrels/ day how long does it take to use 30 million barrels?
Question 2 /- 30 million barrels of oil is.......
a/ a ship load
b/ truck load
c/ a load in ya pants
The usual prizes
A junk? o.0
Here is another question. If the government sells 30 million barrels of oil @ 112.78 per barrel in ONE lot, who are they going to sell it to?
That = $3,383,400,000 or over $3 billion worth of oil to be delivered and paid for in 1 month.
How many buyers are big enough to bid on that? Foreign countries or bid oil companies?
Be interesting to see who buys it, at what price, and what they do with it. I don't think it will go to China.
Since there is no shortage of physical oil in the US for consumers, and recovery summer 2 is a a myth - the US is sort of ineligible to consume the increased production. It will serve to supply "somewhere" with growing GDP (energy consumption).
What a nice campaign slush fund Obambi has found.
Has to make up those missing donors from tonite's rubber chicken fest.
(puke)
He doesn't need one. He's already got a billion dollars in the slush fund he has now.
Hmmm..... outta no where we got this coordinate oil strategy. Is it possible that they are going to escalate the situation on Lybia openly ?!
They pre-emptively strike down the oil price before they are going to put boots on the ground in Lybia. Further escalation in middle east will spike the oil price higher. They are showing government will do something to suppress oil price. So, even if more crisis in middle east, the oil price will be suppressed.
Sounds like as good of a guess as any. Then again, August is when the wheels fall off of the Treasury's game of musical chairs. Could the proceeds of this sale fund fedgov for a couple of days while they make the Tea Party reps twist in the wind for forcing us to sell the SPR to China, instead of getting a higher credit limit?,m
In other news, just yesterday I got gas at the lowest price I can remember in the last year at $3.39.
where do you think the troop withdrawals in afghanistan will end up?
Syria and all to isolate Iran.........
http://www.google.com/hostednews/afp/article/ALeqM5gY1VVmakHHVnfk_qA0E957yzPj7A?docId=CNG.e4a5c99551e28f7d9fd2b30cb3dcbf78.1271
Or this.......about Iran........things are heating up.....
http://www.google.com/hostednews/afp/article/ALeqM5iM5e8SlPZD9mCIFZkwnfrx941TTw?docId=CNG.e4a5c99551e28f7d9fd2b30cb3dcbf78.10c1
Doubtful on Syria.
Have you seen this?...Assad has Hezbollah doing a little "free lance" work for him...again...
"Hezbollah has thrown in its lot with Assad against the Syrian people, supplying gunmen to execute Syrian soldiers who refuse to take part in the killing of Syrian citizens. By siding so unequivocally with the Alawite dictator over his captive, predominantly Sunni population, and in a dispute that has nothing to do with Israel no less, Hezbollah has exploded its carefully constructed image as the standard-bearer for the Muslim common man against the Zionist enemy. Outraged Syrians are now being filmed burning posters of Hezbollah’s chief, Sheikh Hassan Nasrallah."
http://pajamasmedia.com/blog/hezbollahs-miscalculation-in-syria/?singlepage=true
when the easter bunnie
snorts a line of coke off
paris hiltons butt....
Seems I don't understand. Obama is releasing US oil reserves to help lower the price of our gasoline but China can buy the oil? I don't get it.
It's fungible.
He'll sell it all if it appears to help his re-election chances.
WTF is this shit? I want my fucking Iraqi conquest dividend...where is it??
We've got 4,500 dead soldiers in Iraq, thousands more injured, dropped a couple trillion $$ in military expeditures + rebuilding (lost a couple billion $$ along the way but who's counting) and when things get a little tough we have to crack open our salt domes and spend our oil savings...why can't we just ship ourselves a little extra oil from Iraq? What a shitty fucking investment that's turned out to be.
Yeah, I have to agree. Next time this Country of ours goes to War for oil, how about we actually get oil.
++Both of your posts
Our oil companies have plenty of production access. The idea wasn't that we get free oil. The idea was that our big businesses get the profits from selling us the oil.
the entire spr is only worth $70B at today's prices. I'm sure china would love to buy the whole thing. Oil is waaaay underpriced.
i'm looking @ WTI @ $91.94/bbl, & brent @ $107.26. LOL...
all at once. sell 30mm bbl all at once. that ought to send them cheatin varmints a-scatterin. just bid away @ no_vaseline/cartel[dot] [com]
the banksters/oil companies will handle this. timmah will help.
don't worry. soon there will be an ETF in US oil reserve tranch options. very soon. this will enable the ETF holders to sell the oil reserve back to the goobermint; after they buy it. this new ETF will feature different margin requirements for each day of the week.
this is a heluva product, as we always strive to be ready to short to you anything we might have bid on; or our agents; or family or relatives; or car or insurance agents; or dentists.
trust us.
LMAO!
WWill the be giving out extra food stamps for hot dogs and burgers for the 4th of July weekend too?
Why didn't they do this when gas was .50c a gallon higher? Things must be about to get worse if we are now in an energy "emergency"!
I wonder if they were pressured into auctioning the SPR in order to sell any more junk bonds?
So what is stopping, say, a Chinese company from buying it all?? Is it really possible it could all just end up in some ChiCom storage post?? The potential irony of it all seems too astounding to be plausible, but I don't assume anything anymore.
"Winning companies would pay for their oil during the month after the crude is delivered." I'll gladly pay you Tuesday for a hamburger today! Why would we sell this on a net 30 basis? It's our strategic reserve! Jarrett is stupid; I hope she doesn't get re-elected.
Well, if we're gonna sell the Chinese Communists our oil from the Strategic Petroleum Reserve we might as well start selling of parts of the United States:
http://www.freepressers.com/2011/06/china-wants-to-construct-a-50-square-mile-self-sustaining-city-south-of-boise-idaho/
Sell them Maryland instead. Why waste good potato property?
Maybe we could jackhammer off parts of California and float those over and be done with it.
China will quarantine the shit and send it back.
Let them have all of DC - could they make it worse?...well, I suppose they could.........
Go back to sleep America. Enjoy your slave state*. Watch sports and drink more beer...you fucking morons.
*Economic Zone is one where the local, state, and Federal laws do not apply, e.g., minimum wage, health and safety, etc.
Perhaps in you world, but in many of the emerging and undeveloped economies, that is where the good jobs are.
Ever been outside the radius of your crackerbox subdivision? Ever been to a 3rd world country where people live in cardboard shacks or beneath a tin leaning against a palm tree, and where suicide rates for young men run to 25% because of despair? No? Didn't think so.
I've been bringing FDI and materials to those very economic development zones for years.
Since you seem to have a fascination with cracker box subdivisions I am wondering if you don't spend too much time watching aid appeals or ideological propaganda on TV, perhaps in your parents' basement?
If one isn't a politician or aristocrat, then the domestic income opportunities tend to far more limited once you travel outside the economic development zones and are solely dependent upon local purchasing power for a customer base from which to derive a salary.
Is that a fact. Well you should change your pseud to Tropical Redneck.
Constitution, what the hell is that. Never heard of it. What a crock. Gotta get rid of the 3 stooges.
I bet there's tungsten in that oil.
the fed does Qe aises the cost of oil, so we release the reserve. once more the tax payers take it up the ass. we have to pay to replace the oil, we pay in low interest rates and decreased returns on savings. All because of fed monetary policy. Why can't those in power (except Ron Paul) name the villian, and the vilian's name is the federal reserve. This is just more wealth tranfer disguised as helping the economy. give real interest rates, make a currency worth something.
It is astouning that when official voices determine when they need to do something they always decide the wrong thing. Once more Obama needs to get rid of his economic team. Period. What I really smell is Obama realizing he may loose the election and desperation. Alas, he will always pick the wrong thing to do.
i question who directed the sale of this oil, as the IAE has authority to order such release, as I understand the vaguely worded directive. This sale is a real WTF, because if America is selling its strategic stockpile of oil to satisfy the demands of an international organization, what's next? Maybe they'll tell us to disarm our military? Sell our gold?And if Obama is going along with this mini UN just so he can get reelected then I think we should talk impeachment here, and to hell with waiting until November.
They are only selling 30M bbls because that's all the law allows them to sell in a 60 day period, and without emergency. Again Bush released less than than to take care of all the problems with Katrina. If you thought Bush is bad wait until you see the next guy... me, 2008
Even worse, the "talks" started in April. Guess the Squirrel knew he was tanking then.
QE3 via oil, anyone?
After all, oil does effect the price of everything.
QE4 - US sells copper in electrical grid
QE5 - Yellowstone
...
QE19692 - Lincoln Bedroom Set
...
QE260247856027598725 - Your gold fillings
$3B and change....or ~1/2 of the amount they've been POMO'ing into the fetid veins of the zombies daily...for months? Uh, no.
Dupe
jamie, blythe, & i think we can sell the SPR at least 50-100X. ez, BiCheZ!
If you were China would you rather hold US dollars or oil? Simple isn't it.
It is so stupid to tap the SPR for anything other than an emergency. Is it possible that there is a shortage that we are not aware of.
yeah. a shortage of jobs which will lead to a shortage of votes for obamanation.
A shortage of votes for the Statists is apparent.
Hopefully.....but who aren't the statists these days?
Nothing new. The SPR has always been an expedient socio-political pacifier.
The Treasury needs the cash. Don't be so hard on them. It's the same with the Tax holiday for those Corps that have all those dollars overseas. That should be passed shortly. Once that money is in this country, it will give the treasury a huge bump in available capital, along with the pension funds, to keep the BANKS from going under. Stay tuned for the next USA garage sale.
Well, time to jump back into the USDHUF pool, I guess. Show me 188.5!
Why am I seeing -error- on USDCNY? A sign?
close, but moved to 188.3 - gonna be a busy nite
WTI Cushing spot is currently trading at about $91. I don't know what the contango is 2 months out but I bet it's not $20. Why bid for this 'new' oil when you can take delivery for less with futures?
"Invasion of Earth will be a piece of cake, the humans running the planet are stupider than Jupiter" -- Gwar 26
Thank you Dr. William Levingston
RE intro and article
False premise that this operation lets China do something they can't do. They buy oil now- around the world, storing some and will continue whether USA sells its stockpile or not. The link to Obama is zero, hedged or not.
World daily consumption is 82 mil barrels PER DAY. 30 million barrels is one million a day for 30 days. Big deal? Zero game changer for any realistic time frame. Europe will supply another 30 mil and I am sure Obama has no control on that.
What it might prevent is a possible skyrocket in Brent crude over the summer months. At least a few more months of only semi-high prices of gasoline.
It may be that Brent users will have to store some Brent in the winter for the summers to flattened out the demand curve, lowering the average annual price.
Holy crap!! You cant make this shit up. I think the raod warrior index is up.
Long bullets short politicians
http://www.survivalthinktank.com/2010/07/road-warrior-index-update.html
Now im gona go play some cards at least that is a game of skill.
I wonder what the GAO (or similar body) shows as the $price/bbl of the SPR inventory. Like every other strategic initiative the US Gov has engaged in, it is doubtful to me at least that A.) the volume of crude in the SPR is publicly known and B.) what real intended result comes from the decision to "release" it.
After all, aren't there still Tankers full up with the stuff at sea? Isn't it possible the SPR is also made up of undelivered crude? (the US did't take physical delivery so to speak)
What about IRAQ? Who controls that stock?
I know its easy to disparage bureaucrats as lazy, dumb, incompetent, whatever: but absent a full disclosure/investigative Matt Taibbi-esque treatment of this, I am not so sure the 30MM bbl release relative to daily use is the math we are looking for.
5yr chart of BDI, we are so not improving, I'll take questions after the break.
http://www.bloomberg.com/apps/quote?ticker=BDIY&exch=IND&x=15&y=11
watch the commodity indexes be rebalanced with 50% S&P 500 future contracts and oil and PM removed ala Goldman changing the GSCI back in 2006.
Its just an excuse for the US to buy oil at $150/bbl by Winter from the Saudis.
Why should anyone here really care?
Its not like its a market anymore.
Its just a 'newz flash.'
Its all about as important or controllable as meteor across the sky.
The oil players knew this was coming a week ago.
You did not know it and never will.
Just go to the pump and pay and get ready for your family barbeque.
The US Federal Corp is broke and desperate. Time to liquidate...
fire sale
1. (Business / Commerce) a sale of goods at reduced prices after a fire at a shop or factory
2. (Business / Commerce) any instance of offering goods or assets at greatly reduced prices to ensure a quick sale <---- Ding, Ding, ding
An old story many should watch. I'm a Paul Kelly fan.
From Little Things Big Things Grow
http://www.youtube.com/watch?v=bF4i7JEOzzM
This is a perfect example of the total dipshits running government. Only these turd types would hold a sale like this.
In the real world, it goes down like this:
"Hello Exxon, what's your bid for 30 mil of sweet crude?"
"Sold"
Wire the money and you can pick up your oil. WTF is so hard about this?
I swear, some days I just can't take it anymore.
With US crude prices already down 16 percent from their April high, pundits and politicians everywhere were asking Thursday: "Why would President Obama tap the Strategic Petroleum Reserve when oil prices were already falling?”
The answer is simple: Obama knew this would have the maximum impact, hitting speculators on the chin, according to traders.
“Arguably the timing of the release is genius,” said Stephen Weiss of Short Hills Capital....
story illudes to tribute to China for US and European debt
So, now we're selling off the SPR to help balance the budget? WTF - this guy is a bigger moron than I thought.......and I thought he was an enourmous one before.
He is not "tapping it", he is selling it. Its a garage sale to cover the the bills. Lets see how big the drawdown is - shhhh! No one knows that they will have to buy it back later - sure everyone will stand aside and let OBumbler buy back cheap.
When the WH China goes on the market, will; he be "tapping the dishware"
Lower commodity prices will be beneficial is they do try QE3 though.
Hmm, I wonder if TPTB see a VERY significant event coming in Aug that would restrict oil supply and are preempting a severe oil supply crunch with this move.
My insight into the chatter on TOD and elsewere has been to expect some global production shortages this summer but not significant enough to warrant SPR release.
heard similar theory floated on Blmbrg (pimm foxes show at 5pm but can't find the clip) but concensus of the pundits he was interviewing seemed to be total bewilderment and likely political/some sort of back door stimulus attempt.
perhaps forshadows an official greed default coming soone
I'm not sure we can blame Obama for this - when would he have time to figure something like this out what with his 49 consecutive days of golf, or whatever the number is.
So China said "give us oil or we dump your debt"?
JAPAN ECONMIN YOSANO: IEA DECISION TO RELEASE OIL STOCKS IS WARNING AGAINST SPECULATIVE BUYERS
The coke vial is empty... this is Obumbler licking the mirror. Just waiting for his peeps in Congress to get some more dope.
Obumbler does not have any answers; and when you think of it The Bernank has a worse record than a monkey throwing darts.
If this desperate move doesnt scream " get back into energy companies now" then i dont know what does. VDE is a reasonable play here. Jump back in with me fellows. Lets see what price we get in the morning.
I had to borrow money from my little sis for this one cause i am 100 percent long the stock market already in my spec funds. She made me put up some collateral. Smart little sis.
i know its seems unlikely but selling oil at 102$bbl might be smart when the price is half that six months from now. we are in a deflationary crash. be careful.
First,dont be suprised that the oil never leaves the ground. Oil Companies do not buy open market oil....they produce (at least in 1991 after wellhead-upstream- for about .18 a barrel) and sell period....a good dog and pony show though....methinks obamy has his foot in his mouth.
As for producer nations...one of the most important factors that is always left out is the oil consumption within that nation..Saudi may pump 9 mbpd but they use 3 mbpd in house....great comedy today.