Let’s face it, the rampant rise in oil prices, is a big headache for politicians around the world, as the lift in prices is driving inflation. Just remember oil was already on the up BEFORE Ukraine kicked off.
And if you are going to make an unpopular policy change, when better than later Friday before a holiday weekend – the good ol’ putting the trash out.
Certainly the price of oil is a problem and it seems that any selloff in oil is only proving to be a buy-back opportunity amid one highly volatile energy market. Perhaps the most volatile ever.
Crude prices jumped almost 3% on the day and nearly 9% on the week as the market was hijacked once again by a supply scare on news that the European Union might phase in a ban on Russian oil imports.
Gains in oil were limited earlier in the day as Chinese refiners appeared set to cut crude throughput this month by about 6%. The reduction would be a scale last seen in the early days of the COVID-19 pandemic two years ago, industry sources and analysts said.
But news of the proposed EU ban on Russian oil prompted buyers to swoop in on more lots of crude futures and convinced some shorts to cover their positions as well ahead of the Good Friday holiday, which meant a longer weekend for U.S. markets.
“Heading into the long weekend, oil was vulnerable to some profit-taking, but a major pullback is still unwarranted given the supply situation and as economic slowdown concerns are still far from happening”.
Now the inflation problem is creating a series of back-flips including one relating to plans for oil and gas development on federal lands as now the Biden administration has said it has resumed plans for oil and gas development on federal lands. Granted the plan calls for the government to lease fewer acres for drilling than initially proposed, charge steeper royalties to oil and gas companies, and assess the climate impact of developing the acreage.
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