- The Strategic Petroleum Reserve (SPR) is at its lowest level since 1983, with only 50% of its storage capacity filled
- President Biden authorized significant releases as a political move ahead of the 2022 midterm elections
- Biden’s energy policies have led to a significant increase in energy prices
- The ongoing Israel-Hamas conflict threatens the stability of the Middle East and can impact global oil supply
- The oil markets spiked, with WTI crude closing up 5.8% at $87.69 in reaction to concerns about the conflict’s potential to disrupt the oil supply
Just as his approval ratings hit rock bottom, the nation’s Strategic Petroleum Reserve is half-empty and at its lowest since 1983.
President Biden’s energy policy is the root cause of many evils. Be it the Russia-Ukraine war, Bidenflation, food security, national security, etc. Since President Biden took office, energy prices have climbed 39%, with gasoline prices increasing by 53% and fuel oil by 61%.
Fifty years ago, in 1973, OPEC imposed an embargo on the U.S. due to its support for Israel during the Yom Kippur War. In response to this event, the U.S. established the Strategic Petroleum Reserve (SPR) in 1975 to enhance America’s national energy security during supply disruptions.
The SPR stores oil in salt caverns thousands of feet below ground and has a storage capacity of 727 million barrels of oil. The U.S. consumes 20 million gallons of oil a day. On average, the SPR has held 33 days of supply.
The U.S. utilized the SPR for emergency releases in response to Operation Desert Storm in 1991, the aftermath of Hurricane Katrina in 2005, and the disruptions caused by the Libyan civil war in 2011.
But, President Biden has converted the Strategic Petroleum Reserve to a Strategic Political Reserve.
Like he signed an executive order to waive student loans to attract young voters, Biden timed significant releases before the 2022 midterms to bring down gasoline prices to mollify voters.
President Biden’s decision to use the SPR for political purposes, compromising national security, was myopic and irresponsible.
American Petroleum Institute (API) said, “The SPR was established to reduce the impact of severe supply disruptions, not as a long-term solution to the economic pain Americans are feeling at the pump. We urge the administration to recognize that short-term policy-making is no substitute for the long-term strategies needed to encourage energy production.”
The SPR has not been replenished due to high oil prices. The Department of Energy (DOE) scuttled replenishment plans when the oil price hit $80 a barrel. The restocking to old levels will likely take several years.
As the nation’s vulnerability increases, why not move the goalpost by lowering the SPR target to make ourselves feel good! That’s what a recent analysis by a senior economist at the Dallas Fed did on October 3, just a few days before the onset of the Hamas-Israel conflict.
The Dallas Fed paper said:
While the SPR peaked at 727 mb and held more than 600 mb just two years ago, current and prospective oil market conditions indicate the U.S. is unlikely to require that level of strategic inventories again. Moreover, refilling the SPR does not appear to be as pressing an emergency as the drop in absolute levels initially suggests. Rather, an appropriate target for the refilled level might be above what current funding allows but well below the maximum capacity of the reserves.
The Israel-Hamas conflict threatens the stability of the Middle East and can impact the global oil supply. On Friday, the oil markets spiked, with WTI closing up 5.8% to $87.69 in reaction to concerns about the conflict’s potential to upset the oil supply. The SPR was founded precisely to address times such as now. But Biden’s political maneuvers have compromised national security.
Biden’s war on fossil fuels transformed the U.S. from energy independence to energy dependence. The President would rather pipe oil from countries like Russia, Venezuela, Saudi Arabia, or OPEC+.
By doing so and coupled with politically motivated releases, President Biden has compromised the original purpose of the SPR and dented American national security for years to come.
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Geopolitics And Geoeconomics
“The lives of thousands of patients” will be “at risk” if fuel reserves at all of Gaza’s hospitals run out in the next 24 hours as is expected, the UN is warning.
“Gaza is being strangled, and it seems that the world right now has lost its humanity,” Philippe Lazzarini, Commissioner-General of the UN Relief and Works Agency for Palestine Refugees in the Near East, said in a stark speech from the agency’s headquarters in East Jerusalem.
In a phone call with Venezuelan President Nicolas Maduro, President Mahmoud Abbas called the Palestine Liberation Organization the “sole legitimate representative of the Palestinian people,” according to official news agency WAFA.
Any move by Israel to occupy the Gaza Strip again would be a “big mistake,” President Joe Biden said in an interview.
Hamas “don’t represent all the Palestinian people,” he continued. But invading and “taking out the extremists” is a “necessary requirement,” he added.
Israel first occupied Gaza during the 1967 Six-Day War and was only fully returned to Palestinians in 2005.
President Joe Biden is considering a trip to Israel in the coming days, but a senior administration official said nothing has been finalized.
The official could not publicly discuss internal deliberations about the potential presidential travel and spoke to The Associated Press on condition of anonymity.
White House National Security Advisor Jake Sullivan cited the possibility of a new battlefront on the Israel-Lebanon border.
He said, “We can’t rule out that Iran would choose to get directly engaged some way. We have to prepare for every possible contingency.”
Iran is a long-time backer of the militant groups Hamas and Hezbollah in Lebanon, providing them with funding and weapons.
“If the Zionist aggressions do not stop, the hands of all parties in the region are on the trigger,” Iran’s foreign minister Hossein Amir-Abdollahian said.
Iran’s top authority, Supreme Leader Ali Khamenei, said on Tuesday Tehran was not involved in the militant Hamas group’s attack on Israel but hailed what he called Israel’s “irreparable” military and intelligence defeat.
“Saudi Arabia has decided to pause discussion on possible normalization and has informed U.S. officials,” a source familiar with the discussions said.
Under de facto ruler Crown Prince Mohammed bin Salman, Riyadh had laid out conditions for normalization, including security guarantees from Washington and help developing a civilian nuclear program.
Many analysts saw The deal as a long shot even before the war began.
“Rail logistics continues to be a vital component in sustaining Russia’s invasion. Russia uses its rail networks to move ammunition, armor, fuel, and personnel into Ukraine,” the British Ministry of Defense said in its war intelligence update.
Meanwhile, the Washington-based think tank Institute of Study of War (ISW) reported, “Russian occupation authorities continue efforts to forcibly depopulate occupied Mariupol… of Ukrainians and replace them with Russians.”
“On October 18-19, at the invitation of the ministry of foreign affairs of [North Korea], the Russian foreign minister Sergei Lavrov will pay an official visit to [North Korea],” Moscow’s foreign ministry said in a statement.
Meanwhile, Lavrov arrived in China to start visiting Beijing, which will host its third Belt and Road international forum, state news agency TASS reported.
Chinese envoy Zhai Jun will visit the Middle East next week to push for a ceasefire in the Israel-Hamas conflict and promote peace talks, state broadcaster CCTV reported.
China’s official statements on the conflict have not specifically named Hamas in their condemnations of violence, leading to criticism from some Western officials who said they were too weak.
The Philippines said the incident occurred on October 13 near Thitu Island, known as Pag-asa Island in the Philippines, after a Chinese navy ship shadowed a Philippine navy vessel and tried to cross its path.
Thitu, part of the Spratly Islands chain, was occupied by the Philippines in the 1970s and is now home to as many as 400 people.
South Korean Prime Minister Han Duck-soo raised his opposition to the forced repatriation of North Koreans when he met with Chinese President Xi Jinping in China last month, Yonhap News Agency reported, citing South Korea’s ambassador to China, Chung Jae-ho.
The election pitted the conservative ruling Law and Justice, or PiS, a populist party that tussled with the EU during its eight years in power, against a center-left coalition led by former PM and European Council president Donald Tusk.
PiS, if it wins, is expected to pull back on aid to Ukraine as it defends against invading Russia.
Voters also weighed in on a referendum to express support for or oppose the European Union’s migrant relocation plan.
It would mark the first time that the B-52 Stratofortress has landed at a South Korean air base. However, the long-range bombers capable of carrying nuclear weapons flew over the Korean Peninsula for joint drills between South Korea and the U.S.
The deployment of the nuclear-capable B-52 is expected to demonstrate the U.S. commitment to further enhance the regular visibility of strategic assets in the region amid heightened tension over Pyongyang’s growing nuclear threat.
North Korea rapped Japan’s plan to move the deployment of domestically made long-range missiles forward to an earlier date, with its state media saying Tokyo’s military moves for a “reinvasion” have reached a grave phase.
Japanese Defense Minister Minoru Kihara said last week that his ministry has been studying the feasibility of deploying all types of Japan-made long-range missiles sooner than the original schedule of fiscal 2026.
With more than 70 percent of ballots counted, about 61 percent of Australians said “no” when asked if the country’s 1901 constitution should be changed to recognize the country’s original inhabitants.
Less than 4 percent of Australia’s 26 million people are Indigenous.
Indigenous supporters of the Voice said it was “a bitter irony” that “people who have only been on this continent for 235 years would refuse to recognize those whose home this land has been for 60,000” years.
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Republished with permission from TIPP Insights