A Quick Note on Biden's Strategic Petroleum Reserve Release...

Nominal president Joe Biden announced the release of 50 million barrels of oil from our nation's Strategic Petroleum Reserve for purely political reasons. The SPR is an emergency stockpile of crude oil that supposedly exists to enhance our national security, yet Mr. Biden is willing to cut 50 million barrels from its 714 million barrel capacity to try to prop up his fading polling numbers.

Biden and his dishonest lieutenants like Energy Secretary Jennifer Granholm contend that this release will help lower gasoline prices at the pump just in time for Thanksgiving. But executing this release will take weeks and happen on a piecemeal basis. In fact, Granholm claimed this morning that she expects the release to cut gas prices by … wait for it … 3 cents per gallon. As we sit here today, the price for a gallon of regular is up by $1.31 since Election Day 2020, and by over 90 cents per gallon since Biden’s inauguration.

All this for 3 cents? REALLY???

Gasoline prices follow crude prices, and the price for crude is set on a speculative global market. 50 millions barrels amounts to 1/2 of 1 day's consumption of crude globally: It is a basic rounding error that will quickly work its way through the system and have no lasting impact on crude prices. The market has already priced this move in over the last few trading days in any event.

Analysts at Goldman Sachs basically confirmed this reality Monday by saying that the market's fundamentals still support higher oil prices.

Bottom Line: This is a crass political act from a crass political animal who has prowled the DC Swamps for half a century. It is also an act that diminishes America's national security for temporary political gain.

Not good.

[P.S.: In the hour following Biden's announcement, the price for Brent ROSE by $1.30. You just can't make this stuff up, folks.]

That is all.