Oil prices fell on Tuesday, after President Joe Biden announced the release of 50 million barrels of oil from strategic petroleum reserves (SPR) stockpile.
WTI futures contracts for January delivery fell $1.38 lower from Monday night's close at $75.38 a barrel immediately following news of the SPR release. Brent crude contracts for January delivery fell $1.02 to a two-month low of $78.74 per barrel.
Last week, U.S. oil prices fell to a six-week low, following reports that Biden had asked other major world leaders to authorize the release of their own reserves to increase global oil supplies and therefore offset the price impact from OPEC’s oil production cuts.
The SPR, established after the oil crisis of the 1970s, consists of oil is stored in underground salt caverns in Texas and Louisiana. This is an emergency reserve, and the caverns currently hold more than 600 million barrels of oil.