Oil prices fell early Thursday as the US government considered releasing 1 million barrels of crude oil per day from its Strategic Petroleum Reserve (SPR) for several months.
Rising crude prices were dampened after supply fears sent oil prices soaring on Wednesday, following a decline in US oil inventories, returning the focus to supply disruptions. trading at about $108 a barrel. But the volatility was reflected in the trading price range between $107.8 and $112.94.
US West Texas Intermediate futures fell nearly $6 a barrel, or about 6 percent, to $101.99 a barrel, having previously fallen to as low as $100.85.
Brent prices moved 3 percent higher on Wednesday, driven by supply concerns, as peace talks to end the war between Russia and Ukraine stalled and oil-producing countries slated today may be able to increase supplies. .
US President Biden is expected to announce plans to release oil from their massive emergency reserves, aimed at lowering gasoline prices that have hit record highs following Russia’s invasion of Ukraine.
The move would mark the third time the US has tapped its strategic reserves in the past six months and would be the most significant release in the nearly 50-year history of the SPR.
So far, US releases have failed to bring prices down as world demand has nearly reached pre-pandemic levels while global supply has declined.
Oil prices have risen since Russia invaded Ukraine in late February, and the US and allies responded with hefty sanctions against Russia, the world’s second largest exporter of crude oil.
Brent oil rose to nearly $140 a barrel earlier this month, the highest level since the 2008 financial crisis and has remained above $110 a barrel since Russia’s invasion of Ukraine on February 24.