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Monday, December 6, 2021

Biden asks China to consider freeing up crude oil reserves in an effort to meet supply demand: White House

The Biden administration has asked China to consider freeing up crude oil reserves to meet supply needs, the White House said Thursday.

White House spokeswoman Jen Psaki said at a press conference that members of Biden’s national security team “have discussed with a number of countries, including China, the need to meet supply demand.”

“But this is an ongoing conversation that we have with a number of partners,” Psaki told reporters.

Other large consumers with whom the administration allegedly had such discussions include India, Japan and South Korea, Reuters reported, citing several people familiar with the requests.

Biden raised the issue of the disclosure of crude oil reserves during a virtual meeting with Chinese leader Xi Jinping on Tuesday, Bloomberg reported.

A spokeswoman for China’s National Food and Strategic Reserves Administration told Bloomberg that “the bureau is currently carrying out work to release crude oil,” but it is unclear if China already had plans to do so or whether the move was prompted by Biden’s request. …

“We will publish more details of the oil volumes and the date of sale on our website in due course, as at the first open auction,” said a spokeswoman for the reserve bureau.

If the release takes place, it will mark the first time that China, the world’s second largest oil consumer and largest oil importer, will participate in an agreed oil release with the United States.

Both Beijing and Washington share concerns over rising oil and fuel prices, as well as rising inflation, which is currently at its highest level since 1990 in the United States.

The joint discussions hope to bring stability to global energy markets and will begin after oil prices hit multi-year highs last month.

This year, China has leveraged its national reserves to lower domestic crude oil prices. In September, the country held its first public auction of oil reserves for a select group of domestic refiners.

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Meanwhile, Biden’s requests to the Organization of the Petroleum Exporting Countries (OPEC) to increase production amid declining supplies and rising energy prices were rejected.

The White House pressured OPEC back in August to boost oil production faster, saying its previous agreement in July to increase production by 400,000 barrels a day each month from August to November was “just not enough” in “critical moment in the world. ” global recovery “.

But OPEC and its oil production allies, OPEC-plus, on November 4 agreed instead to maintain their plan to gradually increase oil production by 400,000 barrels per day each month, finding the economic recovery too volatile to justify an increase in supply.

The 13-member cartel plans to phase out the rest of the production cuts introduced in 2020 in response to the COVID-19 pandemic and falling demand.

“The meeting reaffirmed the continued commitment of the countries participating in the Declaration of Cooperation (DoC) to ensure a stable and balanced oil market, efficient and safe supply to consumers and ensure market clarity at a time when other parts of the Energy Complex outside the oil markets are experiencing extreme instability and instability and continues to take a proactive and transparent approach that has ensured stability in oil markets, ”OPEC said in a statement.

The United States has the world’s largest registered strategic oil reserves at 727 million barrels, while China does not release information on its strategic reserves, although Consultancy Energy Aspects estimated earlier this year that China’s state oil reserves contain about 220 million barrels of crude. oil, which is equivalent to 15 days of demand.

If China and the US agree to take joint action on crude oil, the move could affect world oil prices.

Reuters contributed to this report.

To follow

Katabella Roberts is a reporter currently based in Turkey. She covers news and business for The Epoch Times with a special focus on the United States.

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