RT
Oil prices have continued to fall this week as rumors of President Biden tapping into US oil reserves combined with a resurgence in covid cases in Europe created fresh bearish sentiment.
Resurgent Covid fears triggered by a fresh surge in European cases weighed on oil prices this week, dragging the Brent benchmark towards $78 per barrel, down almost $3 per barrel on Friday alone. With both Brent and WTI set for a fourth weekly decline, it seems that the Biden Administration’s plan to bring outright prices lower has largely worked.
There has so far been no joint action from the world’s largest crude importers; the US, China, and India included, but the threat of them combining forces was strong enough to set a bearish tone to trading over the past days. Downside risks in demand and potential SPR releases have also contributed to a flattening of steep backwardation curves, with 12-month spreads in both Brent and WTI trading at their widest since 2013.
OPEC+ Remains Overcompliant with Targets
According to internal data from the oil group, OPEC+ compliance with production targets stood at 116%, even higher than last month, with both participating members and non-OPEC countries underperforming their monthly target.
US Asks Japan, South Korea, and China to Tap into Their SPRs
The Biden Administration has reportedly asked Asia’s leading crude importers (Japan, South Korea, India, and China) to consider releasing some of their strategic stocks in a bid to lower outright prices by increasing the immediate availability of crude as OPEC+ refuses to ramp up output.
US Congress Mulls 1890 Antitrust Law Against OPEC
A bipartisan group of politicians has been in talks to use the 1890 Sherman antitrust law against OPEC, potentially allowing the US government to sue OPEC countries for manipulating energy prices, a move previously considered a no-go zone because of opposition from the State Department.
