Crude oil prices drifted lower on Thursday, pushing the most active crude futures contract to a 2-week closing low.
Oil prices fell after U.S. President Joe Biden authorized the release of 1 million barrels of oil per day from the nation’s Strategic Petroleum Reserve, for the nextx six months.
West Texas International Crude oil futures for May ended lower by $7.54 or about 7% at $100.28 a barrel, the lowest close since March 16.
WTI crude futures have shed about 12% so far this week. The benchmark has gained about 33% in the January – March quarter, and posted a gain of 5% this month.
Brent crude futures ended down by $5.54 or about 4.9% at $107.91 a barrel today. Brent crude futures shed about 11% so far this week. The contract gained almost 7% in March and posted a gain of nearly 40% in the first quarter.
The White House made the announcement about the historic release from SPR, aiming to combat the spike in oil prices sparked by Russia’s invasion of Ukraine.
“The scale of this release is unprecedented: the world has never had a release of oil reserves at this 1 million per day rate for this length of time,” the White House said. “This record release will provide a historic amount of supply to serve as bridge until the end of the year when domestic production ramps up.”
Biden is also calling for an increase in domestic oil production, with the White House accusing some oil companies of choosing to make extraordinary profits without making additional investment to help with supply.
Meanwhile, at today’s meeting, the OPEC+ decided to stick to the 432,000 barrels per day output increase scheduled for the month of May. The West had been demanding that the OPEC+ group increase production as surging oil prices have contributed to soaring inflation worldwide.