Obama Using Strategic Oil Reserves for Stimulus

[marshabar1]

He's a dangerous lunatic.

(Reuters) - President Barack Obama took withering fire from the oil industry and Republicans for agreeing to release the nation's emergency oil supplies, a decision that senior officials said was prompted by the need to prop up the ailing economy.Critics blasted the release of 30 million barrels of oil -- half of a global injection coordinated by the International Energy Agency -- as an ill-timed misuse of reserves at a time when U.S. supplies are relatively high, despite the loss of Libya's exports for the past three months.

Some OPEC officials went further, calling it a political ploy that ignored Saudi Arabia's promise to step up production and the fact that oil prices had already fallen sharply.

A senior administration official said the decision came after careful analysis of global oil markets -- including expectations that supplies will tighten this summer -- and months of discussions with major oil producers and consumers.

But the move fueled questions about the timing and catalyst for releasing the stocks, which in the past have been used almost exclusively to address abrupt disruptions like natural disasters.

www.reuters.com/article/2011/06/23/us-usa-oil-obama-idUSTRE75M44D20110623

[verrip1]

Not sure about his lunacy. But he sure as hell knows how to buy high and sell low.

[kent]

Jun 23, 2011 14:20:04 GMT -5 verrip1 said:

Not sure about his lunacy. But he sure as hell knows how to buy high and sell low.

And....he doesn't understand what "strategic" means....

[wyouser]

finance.yahoo.com/news/nonopec-govts-to-release-oil-apf-4250255497.html?x=0 Michael Lynch, President of Strategic Energy and Economic Research said the release will likely depress prices temporarily. But he is doubtful it will have a long term impact. "It creates an immediate glut of oil" he said"but they are not solving the problem" If oil demands continues to rise ti historic levels this year oil suppliers will continue to have trouble keeping up" he said. So why now? It maybe buys 3 months lower prices before it begins to climb again. That still protends a problem as we enter the 2012 election year? Thoughts?

[marshabar1]

His timing is always impeccably premature. Bet he sucks at poker too.

[privateinvestor]

This is strictly a political ploy by Obama and one more example of the Charlatan in Chief at work to ensure he gets re elected in 2012....IMHO

[verrip1]

Jun 23, 2011 14:35:29 GMT -5 wyouser said:

finance.yahoo.com/news/nonopec-govts-to-release-oil-apf-4250255497.html?x=0 Michael Lynch, President of Strategic Energy and Economic Research said the release will likely depress prices temporarily. But he is doubtful it will have a long term impact. "It creates an immediate glut of oil" he said"but they are not solving the problem" If oil demands continues to rise ti historic levels this year oil suppliers will continue to have trouble keeping up" he said. So why now? It maybe buys 3 months lower prices before it begins to climb again. That still protends a problem as we enter the 2012 election year? Thoughts?

The point is that the only time it makes sense to EVEN CONSIDER releasing oil from the Reserve is at a moment when prices are extremely high. Releasing oil now that prices are dropping is simply stupid. Releasing oil is not a pre-emptive tool; it is solely a reactionary tool. Oil is fungible.

[wyouser]

so is he going to fire everything in his quiver before the election cycle really gets moving??? "Reactionary" is a tool to ge reelected??

[deziloooooo]

"This is strictly a political ploy by Obama and one more example of the Charlatan in Chief at work to ensure he gets re elected in 2012....IMHO "

Possible you might be correct, and since the one posting the statement above has made it clear that his unhappiness with the current POTUS goes back to before he took the oath of office, I can understand his being upset.

It's what current POTUS can do, initiate certain agendas and actions to help his time in office, done by all of them.

There also might be a reason because the Economy is flat, to have even more unemployed over the summer, when Americans do vacation, move around a lot and there are Vacation employments that are crucial to many parts of the country.

I am thinking one in particular that I am very familiar with , Maine, especially along the coast , Bar Harbor , the road going into there passing through Ellsworth so many other townes, loaded with businesses that cater to the vacationer, from Restaurants, Motels, Hotels, shops, vacation attractions, , and with out the six months of vacationers going into that and other areas of that State, as well as other New England States, as well as other Vacation spots, thinking the Carolina's for example and you all can come up with your own ideas by your own knowledge of your parts of the country, it would be a terrible hardship for those depending on vacation travel if it suffered a large down turn, and there are so many other areas of the country , also dependent on this time of year seasonal employment.

Since it seems all those who frequent these boards are so well off and not dependent on this type of employment to get by it might be a hard thing for them to realize that there are so many of their fellow Americans who rely on this type of employment to get by and survive, but there are, believe me.

Since many of them then collect unemployment the rest of the year, good or bad, just a fact, Maine specifically, this I know as a fact, if they don't get in these quarters of employment they will really be in deep doo, doo, and even more of a drain on the country and it's resources as well as in a terrible type of hurt, then selves and their families including their kids too of course.

So there may have been more to this then meets the eye, done for the good of the populace of our country.

[wyouser]

ok..but if oil rebounds in time for the winter heating season....does that bode well for re election prospects moving into 2012? It isnt just gas for the car that hammers folks. Not freezing in the winter could be somewhat high on the list. Those folks in New England are not noted for having balmy warm winters. I believ #2 fuel oil factors pretty heavy into budgets there??

[privateinvestor]

Jun 23, 2011 15:05:06 GMT -5 wyouser said:

ok..but if oil rebounds in time for the winter heating season....does that bode well for re election prospects moving into 2012? It isnt just gas for the car that hammers folks. Not freezing in the winter could be somewhat high on the list. Those folks in New England are not noted for having balmy warm winters. I believ #2 fuel oil factors pretty heavy into budgets there??

The White House says this is in response to Libya but it was something that Chuck Schumer has been pushing to get the price of gas to go down...that is the thinking by the Liberals but who knows because what they usually say is just BS,,,,,,the market for oil sold off at $90.00 per barrel....and there was a lot of red on Wall St...

So let's face reality Obama is running scared so he is trying to throw as much as he can against the wall in hopes something will stick.. so far that has stuck are his gym socks

[marshabar1]

Stratfor says there's no good reason for him to have done this. The price of gas is high but the price of oil isn't. Oil isn't straining the U.S. economy. The release won't have a long term or significant effect on the world market. The proceeds from the release would fund the government for one day. The STRATEGIC Petroleum Reserve is finite.

blogs.forbes.com/energysource/2011/06/23/obama-taps-strategic-petroleum-reserve-without-good-reason/


Obama's always shooting big wads for nothing.

[txbo]

It’s primarily aimed at chasing the oil speculators to the exit, I bet they short oil now.

[privateinvestor]

In all due respects to Straffor he doesn't know how to play the political game when the President has lousy Approval Ratings and he is running scared IMHO

[marshabar1]

Well txbo, if that's the case good. What'll they mess with next?

[floridayankee]

A glut of oil to create a temporary drop in prices to just an increase in taxes?

That evil, crafty bass turd.

[fairlycrazy23]

Maybe he is selling the oil reserves to give us a few more days to raise the debt ceiling. There are probably at least a trillion dollars worth of assets the US government could easily sell and not have any appreciable effect on operations.

[Deleted]

I got a weird E mail this morning from a guy that is pretty smart.
"Right now, this very moment the largest oil drilling rig in the world is drilling for oil off shore in north Alaska. Oil rigs are punching holes as fast as they can in the Dakotas and Colorado cause the war in the middle east is going to escalate and oil to this country will be shut off. The USA will default on there national debt and the dollar will totally collapse. Sometime around November or December gold and silver will go out of sight and a new currency will be created and backed by gold and silver.
The bad part of this whole thing is Obama has committed the US tax payers to fund the entire war in the middle east and that will break us as a nation and cause our total destruction. Obama the puppet is only following orders and risking his Presidency if the nation figure out what is going on, plus congress is aware of what is going on and most of them are going along with it as they have been bought off. "We the People" are being sucker punched."

Now there is this. What is going on?

[Deleted]

Critics blasted the release of 30 million barrels of oil -- half of a global injection coordinated by the International Energy Agency -- as an ill-timed misuse of reserves at a time when U.S. supplies are relatively high, despite the loss of Libya's exports for the past three months.
But the move fueled questions about the timing and catalyst for releasing the stocks, which in the past have been used almost exclusively to address abrupt disruptions like natural disasters.

I think that it was ok for President Obama to release them anytime that he wants. After all, their primary release time is for a national disaster & I believe that that the whole time President Obama has been president he has been a national disaster. Now it does depend on how you look at him though. Some might think that he is much more of a "World Disaster" than a national disaster.

[deziloooooo]

Jun 23, 2011 17:44:18 GMT -5 @krickitt said:

I got a weird E mail this morning from a guy that is pretty smart.
"Right now, this very moment the largest oil drilling rig in the world is drilling for oil off shore in north Alaska. Oil rigs are punching holes as fast as they can in the Dakotas and Colorado cause the war in the middle east is going to escalate and oil to this country will be shut off. The USA will default on there national debt and the dollar will totally collapse. Sometime around November or December gold and silver will go out of sight and a new currency will be created and backed by gold and silver.
The bad part of this whole thing is Obama has committed the US tax payers to fund the entire war in the middle east and that will break us as a nation and cause our total destruction. Obama the puppet is only following orders and risking his Presidency if the nation figure out what is going on, plus congress is aware of what is going on and most of them are going along with it as they have been bought off. "We the People" are being sucker punched."

Now there is this. What is going on?

"The bad part of this whole thing is Obama has committed the US tax payers to fund the entire war in the middle east and that will break us as a nation and cause our total destruction."

Which war is this? Iraq is over...possibl ewe won't be asked to stay on, Afghanistan was started by Bush..two years ago he came up with a policy to stay there, Pubs were happy there, not to fund as a nation building one and destroying the Taliban, military wanted that, with a trillion dollar price tag and a no end in sight scenario, and more then Bidens wanting 20,000 troops..just keep the Taliban under pressure and go after al Quida.

If you mean the action in Libya, there is some cost there but we are not funding that or even very active as a participant, so if those are your words Krickett, then I don't know what your referring to and if they are your weird{?} guy, guess not a friend but a smart one, don't know what he is referring to. Do You?

[Deleted]

Nope. That's why I'm asking if it makes sense to anyone.

[Deleted]

Hate to break it to you, Dez, but both wars are still going strong, and there is Libya, and wars all over the region..

[deziloooooo]

Jun 23, 2011 18:22:49 GMT -5 @krickitt said:

Hate to break it to you, Dez, but both wars are still going strong, and there is Libya, and wars all over the region..

Iraq war is over...it is. Are there still attacks on Americans at time..?Yes, but the war is over, and actually, while we don't want to leave they , even though all the informed ones want to stay , have a presence, [not sure of how Obama feels about that actually], but the informed is our Military, State Department, Republican and Democrats , the ones who understand the situation and the threat of Iran in the region, possible the PM of Iraq himself, but is afraid for his life , Iranians, al Sader, so will not ask us to stay most likely.

[marshabar1]

The only big disaster Obama is responding to is his falling poll numbers.

[floridayankee]

Jun 23, 2011 18:07:19 GMT -5 deziloooooo said:

If you mean the action in Libya, there is some cost there but we are not funding that or even very active as a participant, so if those are your words Krickett, then I don't know what your referring to and if they are your weird{?} guy, guess not a friend but a smart one, don't know what he is referring to. Do You?

No / low cost? Not very active? Where do you get your info from Dezi?

The United States pays more than 75 percent of the defense budget for the 28 members of the North Atlantic Treaty Organization. Gates said that by slashing their own defense budgets, the European nations are falling short in Libya."The mightiest military alliance in history is only 11 weeks into an operation against a poorly armed regime in a sparsely populated country, yet many allies are beginning to run short of munitions, requiring the U.S., once more, to make up the difference," Gates said.

Meanwhile, as the mission in Libya wears on, the cost is going up.

Defense officials told Fox News that U.S. combat operations in Libya will far exceed the projected cost of $750 million through September 2011 that Gates announced last month. Officials say that by mid-May the U.S. taxpayer had already spent $664 million and there is concern operations could cost more than $40 million for each additional month.

www.foxnews.com/politics/2011/06/10/gates-blasts-nato-questions-future-alliance/#ixzz1QCXTKyJc

[Deleted]

Libya’s oil exports could rise by as much as 355,000 b/d from areas held by forces opposed to the rule of the country’s leader Moammar Gadhafi, according to an analyst report.

“The opposition forces could resume about 200,000 b/d of crude exports as some fields and their related export terminals are largely intact,” said the report by Goldman Sachs Group Inc. “A further 155,000 b/d could potentially be exported at a later stage from a second loading port under their control.”

The report said Libya’s oil exports could climb as high as 585,000 b/d if Gadhafi is removed from power and production resumes from western fields held by his government.

The study, led by analyst David Greely, also warned resumption of the country’s full output of 1.6 million b/d will be much more challenging.

“Not only are the export terminals currently under the control of the Gadhafi government, but news reports also suggest that some of the installations have been severely damaged,” the analysts said.

The report follows earlier predictions by the International Energy Agency that Libya’s oil production for the rest of 2011 will be marginal, with the opposition National Transitional Council (NTC), “perhaps able to export some crude in coming months under NATO protection.”

IEA said Libya’s oil production faces a “long haul” to make a full recovery in the wake of the civil war gripping the country and will not return to its full capacity until 2015.

Libya’s oil production has declined to less than 200,000 b/d from the 1.5-1.6 million b/d produced before the outbreak of hostilities in February.

IEA said rehabilitation of Libya’s production capacity will be painfully slow. It said hopes that “a quick end to the unrest would leave the oil sector relatively unscathed have faded now. Indeed, a long, protracted stoppage is looking increasingly likely.”

IEA said recovery will be slow because international oil companies (IOCs) will be hesitant to return until the situation on the ground is completely safe.

IEA noted much of Libya’s oil is waxy, which can cause significant damage to hastily shuttered equipment and wells if they are shut in for long periods of time. Not least, IEA said Libya’s existing contracts with IOCs may need to be renegotiated.

“By next year, the political dynamics should be settled, one way or another, and by 2013 capacity restored to just below precrisis levels, with a full recovery by 2015,” IEA predicted.

US sanctions tightened

Meanwhile, the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) tightened US sanctions against businesses connected to the Libyan government while lifting sanctions against Shukri Ghanem, the country’s former oil minister.

“Our sanctions are intended to prevent harm and change behavior,” said OFAC Director Adam Szubin of the lifting of sanctions against Ghanem. “To the extent that sanctioned individuals distance themselves from the Gadhafi regime, these measures can be lifted.”

Earlier this month, Ghanem told reporters in Rome he left his position in Libya due to the “unbearable” violence in the country and the “daily spilling of blood” he witnessed there (OGJ Online, June 2, 2011).

OFAC said it identified nine additional companies as subject to sanctions pursuant to Executive Order 13566 for being owned or controlled by the government of Libya.

Despite the tightening of sanctions against the Libyan regime, the US Department of State this week reiterated its support of oil sales by the opposition TNC.

“The US has strongly encouraged sales of oil by the TNC to help meet the needs of the Libyan people,” a spokesperson said, adding that, “We hope that it will encourage other companies in the United States and elsewhere to continue to purchase oil from the TNC.”

US refiner Tesoro earlier announced it had purchased cargo aboard a tanker chartered by the Swiss oil trading company Vitol.

"We purchased a cargo of Libyan crude that was available at the time," Tesoro company spokesman Mike Marcy told OGJ, adding that the purchase was made in "strict accordance with the relevant White House Executive Order, signed by President Obama (OGJ Online, June 20, 2011).”

The MT Equator, a Liberian-flagged tanker, arrived at the single point mooring in Barbers Point, Hawaii, on June 8 to deliver 1.2 million bbl of Libyan crude sold by the TNC, the group’s first confirmed oil transaction.

[AgeOfEnlightenmentSCP]

I'm not sure it's going to matter. 60 million barrels is enough to get us through Sunday.

[privateinvestor]

Obama Using Strategic Oil Reserves for Stimulus

As I understand Obama's reasoning for one month's oil from the Federal reserves; it will bring down the price of gasoline at the pumps thus giving consumers more spending money to stimulate the economy....Not being an economist this sounds logical but will it work?? I doubt it because it is too little too late IMHO...it will take more than a few cents drop in gasoline at the pump to see an increase in consumer spending this summer.. However it the price drop should be @$.50 per gallon ..then who knows??

[marshabar1]

Doubling down against the best advice. That's our boy. Oblunder. This is the clearest example I've seen of the adolescent pre-ejaculative nature of his presidency. I mean the dumping of billions into his discretionary stash was bad, but it could almost be sort of justified and they could almost pretend it did some good and kind of cover up the fact that the whole point was to reward unions who supported Oblunder. But this useless waste? It just seems like adolescent spewing of substance to me. And all for nothing again. Words just words.

[privateinvestor]

This is the clearest example I've seen of the adolescent pre-ejaculative nature of his presidency


You forgot his performance a few weeks ago in Great Britain when Obama toasted the Queen and embarrassed himself, the Queen, Great Britain, Canada, and even some Liberals in San Francisco CA