Biden ‘antagonism’ to U.S. oil industry is strange: Daniel Yergin
"The rest of the world is saying this is really strange"
Author of the article:
Bloomberg News
David Wethe and Alix Steel
Publishing date:Nov 09, 2021 • 
A drill rig in Loving County, Texas. PHOTO BY ANGUS MORDANT/REUTERS FILES
While President Joe Biden has been “jaw-boning” OPEC nations to pump more crude, the rest of the world finds it odd that the leader of the top oil producer isn’t paying more attention to domestic shale, said oil historian Daniel Yergin.
“There’s a basic antagonism and lack of interest — indifference — to the industry, although it has 10.5 million people work in it,” Yergin, vice chairman of IHS Markit Ltd., said in a Bloomberg Television interview on Monday. “The rest of the world is saying this is really strange.”
As Biden considers tapping the Strategic Petroleum Reserve to stem a surge in gasoline prices, Yergin said there isn’t much the White House can do. Talk of releasing crude from the reserve always comes up anytime gasoline prices are high, he said.
“President Biden has been in Washington a long time and knows that high gasoline prices are not good for incumbents,” Yergin said. “They’re obviously worried about 2022 and people do vote their wallets.”
©2021 Bloomberg L.P.
Author of the article:
Bloomberg News
David Wethe and Alix Steel
Publishing date:Nov 09, 2021 •
While President Joe Biden has been “jaw-boning” OPEC nations to pump more crude, the rest of the world finds it odd that the leader of the top oil producer isn’t paying more attention to domestic shale, said oil historian Daniel Yergin.
“There’s a basic antagonism and lack of interest — indifference — to the industry, although it has 10.5 million people work in it,” Yergin, vice chairman of IHS Markit Ltd., said in a Bloomberg Television interview on Monday. “The rest of the world is saying this is really strange.”
As Biden considers tapping the Strategic Petroleum Reserve to stem a surge in gasoline prices, Yergin said there isn’t much the White House can do. Talk of releasing crude from the reserve always comes up anytime gasoline prices are high, he said.
“President Biden has been in Washington a long time and knows that high gasoline prices are not good for incumbents,” Yergin said. “They’re obviously worried about 2022 and people do vote their wallets.”
©2021 Bloomberg L.P.
Pressure Mounts On Biden To Tap U.S. Oil Reserves
With OPEC+ refusing to pump more oil and Saudi Arabia increasing its official selling prices, pressure is increasing on President Biden to consider tapping the Strategic Petroleum Reserves
Chart of the Week
- Netting a third straight month of declines, Chinese crude oil imports dropped to 8.94 million b/d in October, the lowest level since July 2018.
- The regional electricity mandates contributed to a fall in utilization rates to 81%, a five-month low, despite robust demand for transportation fuels.
- Independent refiners were limited in their refining as the Chinese government only issued its last batches of import quotas in early October, luckily China still has some 830 MMbbls of crude inventories, down 80 MMbbls on the year.
Market Movers
- The US conglomerate GE (NYSE:GE) will be split into three public companies focusing on energy, healthcare, and aviation, sending its stock up 7% on the day.
- In a rare move for a Western major, US oil firm ExxonMobil (NYSE:XOM) announced it took an FID on a $10 billion petchem project in China’s Guangdong province that would specialize in performance polymers.
- Spain’s oil firm CEPSA is considering the sale of its chemicals business valued at $3.5 billion as it seeks to garner funds for its transition towards renewable energy, with Citibank chosen to identify possible bidders.
Tuesday, November 09, 2021
The US’ standoff with OPEC has become the main talking point of this week - not only did Saudi Arabia rebuff Washington’s calls for more output, but it also hiked its December official selling prices way beyond market expectations. Whilst US crude inventories have reportedly risen for the third straight week, the pressure is now on the Biden Administration to consider further SPR releases. Meanwhile, jet cracks have bounced back to prominence on the back of travel restrictions being lifted globally (despite both Europe and Asia seeing case spikes), adding some unseasonal strength to middle distillates.
US House of Representatives Approves $1 Trillion Infrastructure Bill. The Biden Administration finally managed to ram through the bipartisan 1 trillion bill that would increase baseline funding on infrastructure by 550 billion and more than 100 billion on clean energy projects.
Gazprom Starts Filling up European Storage. Despite some concerns that Russia’sGazprom (MCX:GAZP) did not book any additional capacity via Ukraine and kept Yamal-Europe deliveries into Germany at zero on Monday, the Russian firm stated today it started to send gas towards its European storage.
Aramco Sees Spare Oil Capacity Shrinking. The Saudi national oil company Saudi Aramco (TADAWUL:2222) said it expects the current 3-4 million b/d global spare production capacity to diminish significantly next year once jet demand returns in full.
Canada’s Oil Sands on Track for All-Time High. Despite the ongoing COP26 hype, Canada’s oil sands producers are on track to reach an all-time high production rate of 3.5 million b/d by December amidst a nationwide move to focus on tight budget discipline and higher dividends.
Qatar Wants More LNG Tankers. In addition to its currently operating fleet of 45 Q-Flex and Q-Max carriers, Qatar has placed another order for six new LNG vessels with South Korean shipyards as it moves to bring its total LNG fleet tally to 100 by the end of 2027.
China’s Coal Production Reaches Multi-Year Peak. Chinese authorities reported that daily average national coal output reached 11.93 million tons over the first week of November, setting the scene for further price declines as Beijing is doing its utmost to alleviate the risks of a prolonged energy crunch. Related: Oil Rally Reverses On Signs Of Cooling Demand
Venezuela Uses Sanctions Calm to Increase Output. Out of the public eye for several months, Venezuela’s national oil company PDVSA raised overall production to more than 600,000 b/d last month as it received Iranian condensate to dilute the extra-heavy crude from the Orinoco Belt.
Saudi Arabia Wants to Pay Back Debts with Windfall Profits. According to media reports, Saudi Arabia is looking to amend the terms of a 16 billion loan due in 2023 and reduce the size of the credit facility, as Riyadh seeks to improve its credit ratings on the back of high oil prices.
Alliance Refinery Set to Become Export Terminal. Unable to sell the 255,000 b/d Alliance Refinery which suffered the most damage from Hurricane Ida, US major Phillips 66 decided to convert the refinery into an oil export terminal, to be finalized by 2022.
UK Funds Rolls Royce to Develop Nuclear. The UK government provided a $550 million backing to Rolls Royce (LON:RR) to develop the country’s first small modular nuclear reactor as London seeks non-intermittent energy sources to complement its vast wind capacity.
Italy’s ENI Quits South Africa Block. The Italian oil major ENI (NYSE:E) withdrew from an offshore block in South Africa, a few months after its six-well drilling programs elicited a strong response from local environmentalists as the drilling would be near sites considered ecologically fragile.
Morocco Looks Towards LNG After Algeria Feud. Having been cut off from Algerian pipeline gas exports on the back of a political spat, Morocco is now considering deploying an FSRU unit to start importing LNG as soon as possible.
Gambia Re-Offers Block Relinquished by BP. Less than a year after BP (NYSE:BP)exited Gambia’s offshore block A1 citing its pivot towards low-carbon projects, the African nation’s government is offering the block in a new bidding round.
By Tom Kool for Oilprice.com
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