Oil getting pounded hard. As I have been saying, watch this commodity. It is the largest commodity out there and affects everything. We know the supply will not be ramped up in the medium term so this could be a judgment on the demand.
The threat of releasing some reserves could also be coming into play.
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Restrictive energy policies took effect in late-January 2021, and they set off a cascade of effects leading to price increases across the board. From extraction to processing to delivery to consumption, costs are added at each step. Costs went up for everyone, and consumers will feel it hard being at the end of the chain of cascades. In the case of fossil fuels, energy not consumed as fuel will be consumed as raw material for products made from them (including "green" products).
I note the above because releasing oil from the Strategic Petroleum Reserve will reduce oil prices by just 18 cents a gallon. That's it. It's small consolation if the discounted price is still much more expensive than it was in 2020. Then when the oil needs to be released from the reserve, it won't be there, or fewer people will have access to it.
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That might be true but it could have a bigger impact on markets. Keep in mind markets do not apply things evenly. The release could cause a major pullback in the trading price, sending the price of gasoline down with it.
Nothing operates in a linear manner.
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Yes but energy costs will be soaring due to the winter season so I expect the prices to rebound until its over.
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I just had to fill up my car and I can confirm it's not getting pounded hard enough!!
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The price goes up quickly, down slowly at the pump.
Just the way they work it.
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