Strategic Oil Reserve
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Well, at least we know where some of it went...
HOUSTON (Reuters) -More than 5 million barrels of oil that were part of a historic U.S. emergency reserves release to lower domestic fuel prices were exported to Europe and Asia last month, according to data and sources, even as U.S. gasoline and diesel prices hit record highs.
www.usnews.com/news/top-news/articles/2022-07-05/oil-from-u-s-reserves-head-overseas-as-gasoline-prices-stay-high -
I am guessing that @Renauda can comment better than me, but oil is not like a car, where you order a car, and a specific one is sent to you.
When you buy gas from your local brand name gas station, it probably came from a competitor refinery.
Oil is generic. If Phillip 66 ships XX barrels of oil to Europe to fill a contract, it doesn't really matter if the oil came from storage place A, storage place B, storage place C, or the strategic reserve . They probably figured that the easiest and cheapest way was to use the oil from the strategic reserve.
If they did not ship it from there, it would have come from somewhere else, so the net effect was zero.
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I am guessing that @Renauda can comment better than me, but oil is not like a car, where you order a car, and a specific one is sent to you.
When you buy gas from your local brand name gas station, it probably came from a competitor refinery.
Oil is generic. If Phillip 66 ships XX barrels of oil to Europe to fill a contract, it doesn't really matter if the oil came from storage place A, storage place B, storage place C, or the strategic reserve . They probably figured that the easiest and cheapest way was to use the oil from the strategic reserve.
If they did not ship it from there, it would have come from somewhere else, so the net effect was zero.
@taiwan_girl said in Strategic Oil Reserve:
I am guessing that @Renauda can comment better than me, but oil is not like a car, where you order a car, and a specific one is sent to you.
When you buy gas from your local brand name gas station, it probably came from a competitor refinery.
Oil is generic. If Phillip 66 ships XX barrels of oil to Europe to fill a contract, it doesn't really matter if the oil came from storage place A, storage place B, storage place C, or the strategic reserve . They probably figured that the easiest and cheapest way was to use the oil from the strategic reserve.
If they did not ship it from there, it would have come from somewhere else, so the net effect was zero.
Strategic means what it says. Now, Presidents have played fast and loose with using the reserve as it's meant to be used, but I don't think any before Biden have sold it to foreign countries.
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@taiwan_girl said in Strategic Oil Reserve:
I am guessing that @Renauda can comment better than me, but oil is not like a car, where you order a car, and a specific one is sent to you.
When you buy gas from your local brand name gas station, it probably came from a competitor refinery.
Oil is generic. If Phillip 66 ships XX barrels of oil to Europe to fill a contract, it doesn't really matter if the oil came from storage place A, storage place B, storage place C, or the strategic reserve . They probably figured that the easiest and cheapest way was to use the oil from the strategic reserve.
If they did not ship it from there, it would have come from somewhere else, so the net effect was zero.
Strategic means what it says. Now, Presidents have played fast and loose with using the reserve as it's meant to be used, but I don't think any before Biden have sold it to foreign countries.
@Jolly Again, oil is generic.
The release from the strategic reserve goes to the various big oil companies.
They have contracts with various foreign countries.
The net result is that there is 5 MM more barrels of oil in the US system.
Would it be better if Phillips sent the oil to Europe from their storage facility, and then refilled the storage facility with the strategic reserve oil?
I am guess that Phillips did this because they eliminated a couple of steps in the transportation/shipping process and saved money.
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@Jolly Again, oil is generic.
The release from the strategic reserve goes to the various big oil companies.
They have contracts with various foreign countries.
The net result is that there is 5 MM more barrels of oil in the US system.
Would it be better if Phillips sent the oil to Europe from their storage facility, and then refilled the storage facility with the strategic reserve oil?
I am guess that Phillips did this because they eliminated a couple of steps in the transportation/shipping process and saved money.
America need not worry. She can always top off those strategic reserves with discounted WCS - Alberta crude. They own it and there are billions of barrels of it for the taking. Can be delivered by pipe or rail. America’s choice.
