Connect with us


Exclusive: Biden sidelined global energy partners with record emergency oil release – sources




© Reuters. FILE PHOTO: A maze of crude oil pipes and valves is pictured during a tour by the Department of Energy at the Strategic Petroleum Reserve in Freeport, Texas, U.S. June 9, 2016. REUTERS/Richard Carson


By Noah Browning and Dmitry Zhdannikov

LONDON (Reuters) – The United States announced a record-sized release of emergency crude oil reserves in March without consulting partners in the International Energy Agency, leaving them scrambling to match with releases of their own, according to two sources familiar with the matter.

Unilateral action by Washington to address global supply or price issues risks undermining the U.S. relationship with the IEA, the world’s energy watchdog that normally oversees international releases from emergency stockpiles, and could raise questions about the continued relevance of the group.

The Paris-based IEA, which groups together 31 mostly industrialized countries, was established after the 1973 oil price shock to ensure continuous energy supplies to its members in the event of an embargo, war, or devastating storm.

The group’s members have become worried that U.S. President Joe Biden is using the Strategic Petroleum Reserve (SPR) to tamp down rampant domestic inflation for political reasons, instead of protecting consumer countries from a global supply disruption, according to the sources who declined to be identified because of the sensitivity of the topic.

“The IEA was embarrassed by the (U.S.) release which was at the start done essentially unilaterally by the U.S.,” said a source familiar with the diplomacy around the release.

“It is the common understanding of IEA members that we must cooperate as a whole,” said another source, this one from an IEA member country, who said the U.S. announcement came as a surprise.

The IEA told Reuters it had been in close contact with all member countries including the United States in the run-up to its two stock release announcements this year: “This consultation as well as the decisions for taking collective action were conducted in line with IEA procedures.”

The U.S. Department of Energy said the United States had been in “frequent contact” with the IEA and its member states on energy security leading up the announcement, but confirmed its decision to release the oil was “independent” of the IEA.

It did not comment on whether the United States shared in advance the timing and volume of its release.

“The United States and other IEA members countries can and have, independently, released oil from their strategic reserves separate from any IEA collective action,” the department said in a statement to Reuters.  

The White House did not immediately respond to a Reuters request for comment.


At issue is the U.S. announcement on March 31 that it would unleash 180 million barrels from the SPR at a pace of 1 million barrels per day to bring down soaring global energy prices and address cuts in Russian oil supplies since its invasion of Ukraine in February.

The sources told Reuters that Washington had not informed the IEA or its members that the announcement was coming – a break with past precedent – and that the record-sized volume, over three times bigger than any previous release from the SPR, was a surprise.

The U.S. announcement came one day before members of the IEA were due to meet to discuss a coordinated release. Following the meeting, which was chaired by U.S Energy Secretary Jennifer Granholm, the IEA announced a coordinated release had been agreed but gave no detail on volumes.

At that point, the IEA’s leadership began bilateral meetings with other members to cobble together contributions, according to the two sources. After a week of diplomacy, it secured commitments from its non-U.S. members to unleash another 60 million barrels combined.

That 60 million-barrel figure was relatively small, however. Per the IEA’s rules, a member country’s contribution to a coordinated emergency release should roughly match the proportion of its oil consumption within the group.

With the United States accounting for about half of consumption among members, the IEA contribution should have roughly matched the U.S. draw.

“That wasn’t doable,” the source familiar with the diplomacy said. “It was impossible as no one had such stocks.”

“The optics of the release being done 75% in the U.S. and 25% in the rest of the world are simply strange,” the source added.

The IEA’s announcement glossed over the mismatch, detailing a 120 million-barrel release, with 60 million of that coming from the United States in the first two months – effectively ignoring the fact the U.S. aimed to keep the oil flowing for an additional four months.

The Biden administration’s release marked the second time in six months that it had signed off on a big drawdown from the SPR without the IEA’s blessing.

In November, the United States pledged a release of 50 million barrels to tame prices rising due to a sudden rebound in demand from the darkest days of the COVID-19 pandemic.

While some IEA members like South Korea, Britain and Japan made contributions to that release, the agency itself sat out because it saw no major supply disruption to address at the time.

After Russia’s invasion, however, IEA member countries saw fit to organize a coordinated release. On March 1, they announced a release of 60 million barrels – half from the United States – to counter likely disruptions to supplies from Russia, a leading global oil and gas producer.


Biden’s Republican opponents have slammed him for his move to release the 180 million barrels from U.S. stockpiles, arguing that the decision was political and that he should be encouraging domestic oil production instead.

Record-high prices for gasoline in the United States are seen as a top vulnerability to Biden’s Democratic party leading into mid-term elections in November.

Biden ran on a promise to phase out fossil fuels to help fight climate change, but his administration has not successfully imposed any curbs on the industry and has in recent months urged drillers to speed up production to bring down prices.


Oil falls 2% on Powell comments, hopes for Venezuela supply



© Reuters. FILE PHOTO: Oil pump jacks are seen at the Vaca Muerta shale oil and gas deposit in the Patagonian province of Neuquen, Argentina, January 21, 2019. REUTERS/Agustin Marcarian

By Stephanie Kelly

NEW YORK (Reuters) -After hitting seven-week highs, oil prices slumped 2% on Tuesday as Reuters reported that the United States could ease some restrictions on Venezuela’s government, raising hopes that the market could see some additional supplies.

Prices also fell after Federal Reserve Chairman Jerome Powell warned the economy could be hurt by attempts to reduce inflation.

For the first time since May 2020, the Brent international benchmark settled below U.S. West Texas Intermediate crude. Refiners worldwide have scrambled to find alternative energy supplies after Russia’s invasion of Ukraine. U.S. reserves are falling and that has raised the price for U.S.-based crudes, said Andrew Lipow, president of Lipow Oil Associates in Houston.

Brent crude fell $2.31, or 2%, to settle at $111.93 a barrel, and U.S. West Texas Intermediate (WTI) crude fell $1.8, or 1.6%, to settle at $112.40 a barrel.

Powell suggested there could be some economic pain involved in bringing inflation down. The U.S. central bank will “keep pushing” to tighten U.S. monetary policy until it is clear that inflation is declining, he said.

“Some of those comments tempered buying enthusiasm on the oil side,” said Phil Flynn, an analyst at Price Futures Group.

U.S. President Joe Biden’s administration will authorize U.S. oil company Chevron Corp (NYSE:CVX) to negotiate with Venezuelan President Nicolas Maduro’s government as soon as Tuesday, Reuters reported, citing sources. There is no final U.S. decision yet on renewing Chevron’s current limited license to operate in Venezuela, the source said.

Oil prices have generally been rising as Russian supply is squeezed by bans from several countries and an economic downturn due to broad sanctions on Moscow imposed by the United States and allies.

Russia’s production dropped by 9% in April, and the country, part of the OPEC+ group, produced far below levels required under a deal to gradually ease record output cuts made during the worst of the pandemic in 2020.

This month, non-Russian deliveries into the Polish port of Gdansk hit the highest in at least seven years, as refiners in eastern Germany and Poland switched.

“Ultimately, this is a supply-side story,” said Fawad Razaqzada, analyst at City Index. “Unless OPEC and its allies ramp up production and fast, it is difficult to see how prices can go down meaningfully.”

EU foreign ministers failed on Monday in their effort to pressure Hungary to lift its veto on the proposed oil embargo. But some diplomats now point to a May 30-31 summit as the moment for agreement on a phased ban on Russian oil.

U.S. crude and gasoline stocks fell last week, according to market sources citing American Petroleum Institute figures on Tuesday. U.S. government data is due on Wednesday. [API/S] [EIA/S]

Continue Reading


Venezuela’s Maduro, opposition expected to talk; U.S. eases some sanctions -sources



© Reuters. FILE PHOTO: Venezuela’s President Nicolas Maduro and his wife Cilia Flores dance during the May Day celebrations in Caracas, Venezuela May 1, 2022. REUTERS/Leonardo Fernandez Viloria

By Vivian Sequera, Matt Spetalnick and Marianna Parraga

CARACAS/WASHINGTON (Reuters) -Venezuelan President Nicolas Maduro and the country’s opposition were expected to announce a resumption of talks as Washington eases some sanctions to help smooth the way for the negotiations, according to U.S. officials and others familiar with the matter.

U.S. President Joe Biden’s administration authorized U.S. oil company Chevron Corp (NYSE:CVX) to open talks with Maduro’s government, temporarily lifting a U.S. ban on such discussions, senior administration officials said on Tuesday.

Washington has not made a final decision on renewing Chevron’s current limited license to operate in Venezuela, several sources told Reuters. Chevron is the last U.S. oil producer to maintain a presence in Venezuela, home to the world’s largest crude reserves.

The United States was also poised to remove Erick Malpica, a former official of state oil company PDVSA and the nephew of Venezuela’s first lady, Cilia Flores, from a sanctions list, one U.S. official told Reuters on condition of anonymity.

The moves, which U.S. officials said were decided in consultation with Venezuela’s opposition, follow a visit to Caracas in March by the highest-ranking U.S. delegation in years, leading to the release of two U.S. detainees.

It was widely seen as a goodwill gesture by Maduro, who is under heavy U.S. sanctions along with his inner circle.

Maduro requested the U.S. lifting of sanctions on Malpica in the Caracas talks, two sources familiar with the matter said. The Venezuelan opposition said it did not ask for the delisting of any sanctioned officials. The White House did not immediately respond to a request for comment.

The Socialist leader also expressed a willingness to return to negotiations in Mexico with the opposition, which he abandoned in October, and sources said the two sides were expected as soon as Tuesday to set a date for resuming talks.

The talks are aimed at resolving Venezuela’s long-running political crisis, and Washington insists that any major lifting of sanctions will depend on progress at the table. The United States has recognized opposition leader Juan Guaido as legitimate president, condemning Maduro’s 2018 re-election as a sham. But Maduro remains in power.

Venezuelan Vice President Delcy Rodriguez said in a post on Twitter (NYSE:TWTR) that her government hopes the U.S. decision to ease some sanctions would pave the way for a total lifting of “the illegal sanctions that affect our people.”


The decision to allow contacts between Chevron and PDVSA – the centerpiece of Venezuela’s U.S.-sanctioned oil sector – has “guardrails” to prevent going beyond the narrow authorization to discuss “potential future activities” in the country, one of the officials said.

The latest U.S. moves, including the Chevron decision, were intended to help encourage renewed Mexico talks, and the steps are contingent on Maduro acting “constructively” in negotiations, officials said.

“It does not allow (Chevron) entry into any agreement with PDVSA or any other activity involving PDVSA,” a senior administration official told reporters. “So fundamentally what they’re doing is just allowed to talk.”

Despite that, Senator Robert Menendez, chairman of the Senate Foreign Relations Committee and Biden’s fellow Democrat, said in statement: “The Biden administration must refrain from lifting any additional sanctions until Maduro makes concrete concessions at the negotiating table.”

The senior administration official said sanctions relief would be calibrated in line with “ambitious, concrete and irreversible outcomes” in negotiations and warned that U.S. steps could be reversed if there was any backsliding by Maduro.

Continue Reading


Oil Inventories Unexpectedly Drop by 2.4M Barrels Last Week: API



© Reuters.

By Yasin Ebrahim — U.S. crude oil inventories unexpectedly dropped last week, the API reported Tuesday, following a day of wild swings in oil prices on easing supply fears as President Biden could reportedly lift a ban on U.S. oil major Chevron (NYSE:CVX) doing business in Venezuela

West Texas Intermediate, the U.S. benchmark, traded at $110.52 per barrel following the report after settling down 1.6% at $112.40 per barrel.

U.S. crude inventories fell by 2.4 million barrels for the week ended May. 12. That compared with a build of 1.6 million barrels reported by the API for the previous week. Economists were expecting an increase of about 1.5 million barrels. 

The API data also showed that gasoline inventories fell by 5.1 million barrels last week, while distillate stocks increased by about 1.1 million barrels.

The official government inventory report due Wednesday is expected to show weekly U.S. crude supplies rose by about 1.4 million barrels last week.


Continue Reading


Stock Markets29 mins ago

Glass Lewis backs McDonald’s directors in boardroom fight with Carl Icahn

2/2 © Reuters. FILE PHOTO: A sign with the logo is on display near a McDonald’s restaurant in Moscow, Russia...

Economy29 mins ago

Australian banks enter tech arms race as rising rates squeeze profit

4/4 © Reuters. FILE PHOTO: A view of a Commonwealth Bank of Australia branch in Sydney, Australia, April 18, 2018....

Stock Markets29 mins ago

China Eastern crash probe eyes intentional action – sources

© Reuters. FILE PHOTO: Rescue workers work at the site where a China Eastern Airlines Boeing 737-800 plane flying from...

Stock Markets29 mins ago

U.S. accuses casino tycoon Wynn of acting as Chinese agent

2/2 © Reuters. FILE PHOTO: Steve Wynn, Chairman and CEO of Wynn Resorts, speaks during the Milken Institute Global Conference...

Cryptocurrency29 mins ago

Commissioner Kristin Johnson to sponsor CFTC Market Risk Advisory Committee

Commissioner Kristin Johnson to sponsor CFTC Market Risk Advisory Committee United States Commodity Futures Trading Commission (CFTC) commissioner Kristin N....

World30 mins ago

Pollution killing 9 million people a year, Africa hardest hit – study

5/5 © Reuters. FILE PHOTO: A boy swims in the polluted water of the Makoko community in Lagos, Nigeria March...

Politics59 mins ago

McConnell urges Biden administration to ensure sustained aid to Ukraine

© Reuters. FILE PHOTO: U.S. Senate Minority Leader Mitch McConnell (R-KY) listens as another Republican senator speaks to reporters following...

Stock Markets59 mins ago

Prominent hedge funds invested in Twitter before Musk unveiled plans

© Reuters. FILE PHOTO: The Twitter logo and trading information is displayed as a trader works on the floor of...

World59 mins ago

N.Korean leader Kim slams officials’ ‘immature’ response amid COVID outbreak

© Reuters. FILE PHOTO: People wearing protective face masks walk amid concerns over the new coronavirus disease (COVID-19) in front...

Stock Markets59 mins ago

Architect of Allianz fraud made $60 million as he lied to investors, U.S. says

3/3 © Reuters. FILE PHOTO: Allianz Global Investors logo is pictured at the company’s headquarters in Frankfurt, Germany August 16,...

Cryptocurrency1 hour ago

Crypto users react to Terraform Labs legal team purportedly leaving company

Crypto users react to Terraform Labs legal team purportedly leaving company The ongoing saga with Terraform Labs, the blockchain developer...

World1 hour ago

Michigan judge blocks enforcement of state’s pre-Roe v. Wade abortion ban

© Reuters. FILE PHOTO: Pro-Choice supporters of Planned Parenthood rally outside a Planned Parenthood clinic in Detroit, Michigan, U.S. February...

Stock Markets1 hour ago

U.S. sues to compel former casino magnate Wynn to register as agent of China

2/2 © Reuters. FILE PHOTO: Steve Wynn, Chairman and CEO of Wynn Resorts, speaks during the Milken Institute Global Conference...

World1 hour ago

Burkina Faso rescuers find no survivors in flooded mine’s rescue chamber

© Reuters. A view shows one of the galleries during a rescue operation inside Perkoa mine where water is still...

Politics1 hour ago

U.S. lawmakers unveil FDA emergency funds bill to address baby formula shortage

2/2 © Reuters. Empty shelves show a shortage of baby formula at a Target store in San Antonio, Texas, U.S....

Commodities1 hour ago

Oil falls 2% on Powell comments, hopes for Venezuela supply

© Reuters. FILE PHOTO: Oil pump jacks are seen at the Vaca Muerta shale oil and gas deposit in the...

Commodities1 hour ago

Venezuela’s Maduro, opposition expected to talk; U.S. eases some sanctions -sources

© Reuters. FILE PHOTO: Venezuela’s President Nicolas Maduro and his wife Cilia Flores dance during the May Day celebrations in...

Stock Markets2 hours ago

U.S. Senator Manchin backs Michael Barr for top Fed regulatory job

© Reuters. FILE PHOTO: The Federal Reserve building is seen before the Federal Reserve board is expected to signal plans...

Sports & General2 hours ago

Dallas hair salon shooting suspect had delusions about Asians, police say

2/2 © Reuters. An image shows the suspect in the shooting at the Hair World Salon in Dallas on May...

Commodities2 hours ago

Oil Inventories Unexpectedly Drop by 2.4M Barrels Last Week: API

© Reuters. By Yasin Ebrahim — U.S. crude oil inventories unexpectedly dropped last week, the API reported Tuesday, following a...

Cryptocurrency2 hours ago

Do Kwon proposes Terra hard fork to save ecosystem

Do Kwon proposes Terra hard fork to save ecosystem On Monday, Do Kwon, co-founder of the troubled Terra Luna blockchain,...

Stock Markets2 hours ago

Elon Musk’s SpaceX is poised to become the most valuable U.S. startup

3/3 © Reuters. FILE PHOTO: A SpaceX Falcon 9 rocket lifts off carrying three NASA astronauts and one ESA astronaut...

Forex2 hours ago

U.S. considering move to block Russian debt payments -Treasury

© Reuters. FILE PHOTO: Russian Rouble coins are seen in front of displayed U.S. Dollar banknote in this illustration taken,...

Sports & General2 hours ago

Key moments in the Johnny Depp and Amber Heard defamation trial

© Reuters. Actor Johnny Depp walks into the courtroom after a break at the Fairfax County Circuit Courthouse in Fairfax,...

Stock Markets2 hours ago

Tesla stops taking orders for Cybertruck outside North America -website

2/2 © Reuters. Tesla’s Cybertruck is displayed at Manhattan’s Meatpacking District in New York City, U.S., May 8, 2021. REUTERS/Jeenah...

Stock Markets2 hours ago

Cisco Earnings, Lowe’s Outlook, Target Reports: 3 Things to Watch

By Liz Moyer — U.S. stocks roared back after a strong retail sales report and reassurances from Federal Reserve...

Sports & General2 hours ago

Depp lawyer questions Heard about drugs, love notes in defamation case

2/2 © Reuters. Actors Amber Heard and Johnny Depp watch as the jury leaves the courtroom at the end of...

Stock Markets2 hours ago

What happened with Abbott baby formula that worsened a U.S. shortage?

2/2 © Reuters. FILE PHOTO: Abbott Laboratories logo is displayed on a screen at the New York Stock Exchange (NYSE)...

Stock Markets2 hours ago

Where’s the beef? McDonald’s, Wendy’s are sued over burger sizes

2/2 © Reuters. FILE PHOTO: The McDonald’s logo is seen outside the fast-food chain McDonald’s in New York, U.S., October...

Stock Markets2 hours ago

Slovak finance minister sets up battle with proposed tax on Russian oil processing

© Reuters. FILE PHOTO: Slovakia’s finance minister, Igor Matovic, speaks to the media as refugees fleeing from Ukraine arrive in...