Why the US stores 700M barrels of oil underground

Post by irq-1 » Tue, Sep 22, 2015, 2:13 PM UTC

Shivetya wrote: post #10

jacobolus wrote: post #8

> But there’s an important line to draw between that and using an SPR for ad hoc manipulation of the world’s markets. On this point, Martin Young is emphatic: “The oil stocks are not there for price management as such,” he explains, “they’re there to correct a shortage in the market because of a supply disruption.” Strategic reserves can absolutely also be used as an offensive economic weapon, however. As one example…

I am not beyond believing that the current gutting of oil prices was done at the US's behest to damage Russia. It wouldn't take too much in the way of guarantees to Saudi Arabia to have them swamp the markets. Far more effective than military intervention.

Post by stuaxo » Tue, Sep 22, 2015, 2:14 PM UTC

Scarbutt wrote: post #42

ghshephard wrote: post #41

Earlier quoted context omitted.

"Small Shale Producers?" We're talking about 49% of total US crude oil production. http://www.eia.gov/tools/faqs/faq.cfm?id=847&t=6

"Small Shale Producers" are the ones that go out of business, of course, the big ones can hold up.

Post by theworstshill » Tue, Sep 22, 2015, 2:33 PM UTC

refurb wrote: post #28

jacobolus wrote: post #8

> But there’s an important line to draw between that and using an SPR for ad hoc manipulation of the world’s markets. On this point, Martin Young is emphatic: “The oil stocks are not there for price management as such,” he explains, “they’re there to correct a shortage in the market because of a supply disruption.” Strategic reserves can absolutely also be used as an offensive economic weapon, however. As one example…

the US dumped >250,000 tons of copper from its strategic reserves onto the world market Do you have a source with more details? 250,000 tons of copper doesn't really sounds like much. Wikipedia says annual WW production is 18M tons, so the US dumped 1.4% of one's year production on the market. Sure, enough to depress prices, but for how long? It would seem like you'd need to keep dumping over a long period of time ot…

Post by adventured » Tue, Sep 22, 2015, 2:34 PM UTC

irq-1 wrote: post #51

Shivetya wrote: post #10

Earlier quoted context omitted.

I am not beyond believing that the current gutting of oil prices was done at the US's behest to damage Russia. It wouldn't take too much in the way of guarantees to Saudi Arabia to have them swamp the markets. Far more effective than military intervention.

I Googled this yesterday thinking the same thing, but the real increases in production came from Iraq (nearly doubling yearly output) and the extra US production. Saudi Arabia didn't seem to have any substantial change in production. Maybe I'm wrong, but that's what I found. Politically, if Saudi Arabia can't be counted on to fix prices when faced with a threat like Russia and Ukraine, then why does the US keep them…

Post by JoeAltmaier » Tue, Sep 22, 2015, 2:39 PM UTC

drzaiusapelord wrote: post #56

JoeAltmaier wrote: post #54

Earlier quoted context omitted.

Because what's fair for most, is not fair for the gorilla. The USA dominates the world in so many ways, when it takes action it is viewed very differently than when, say, Sweden takes action.

Maybe leadership in those countries should take that into account before proudly declaring themselves against US interests, nationalizing US wealth, blocking US ships, kidnapping US citizens, proxy warring against US allies, exporting terrorism, spreading anti-US propaganda, radicalizing its citizens to be anti-West, etc. Jesus man, the US isn't some charity, its a nation with its own self-interests and it will move…