We are currently witnessing a very close game between the USA and the United Arab Emirates...
At stake, the price of a barrel of oil!
We have previously seen OPEC led mainly by the United Arab Emirates knock down its first production cut asset in order to push prices up a barrel.
Consequences: + $ 5 between the announcement on Sunday, April 2 and the opening of the market on the morning of the 3th.
Well done!
This was followed by an increase in the purchase price of their oil for their Asian customer (Arab light) of +0.30 cents.
These cards were played following the violent drop in the price of a barrel because of the sudden banking crisis that panicked the entire market.
The barrel of WTI falling by -$ 16 in a few days...
But the announcement, which in my opinion, tipped OPEC's decision to drastically cut its production, it is the reversal of the Biden administration on the purchase of oil to rebuild its strategic reserves RSP.
Indeed, last December, the Biden administration announced that in 2023 the US government would start rebuilding its strategic oil reserves by wanting to buy back oil if the price was below $72 that was the condition.
Price that had been reached at the beginning of December.
And yet the agreements failed to be concluded...
And against all odds at the beginning of the year 2023, the Biden administration simply backtracked by announcing to release even more oil from its reserves until April 2023!
Reserves that are nevertheless at the lowest level since 1983...
On the pretext that redoing the RSP reserves would take longer than expected and would not be on the agenda for the year 2023...
The straw that broke the camel's back?
This is very likely for the Emirates, which already had more than stormy relations with the US since their president Joe Biden declared to make the Kingdom and Prince Mohammed Ben Salman a "pariat" following the murder of journalist Jamal Khashoggi at the Saudi consulate in Istanbul on October 2, 2018 by a commando of the Saudi special forces.
In my humble opinion, it is this last drop of reversal of opinion on US strategic reserves that has definitively made the cartel decide to knock down its last cards to boost the price of a barrel in an economic market that is dangerously swinging towards a recession.
And now?
Well, the United States has decided to counterattack by announcing that finally it would be possible to rebuild the strategic reserves of American oil this year, IF of course the price of a barrel begins to fall again.
With this announcement, the USA is trying to to influence speculators in the oil market by sending them the message: "Take your profits, shorten the market, it takes a draw down so that we can buy again."
Will "this card" be enough to temporarily bring down the price of a barrel... Not so sure...
But who tries nothing, has nothing.
The price of a barrel has slightly moved down 50 cents today.
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