Bush's Oil Stockpile May Support Prices as Asia Buys

[deminks]

http://www.bloomberg.com/apps/news?pid=20601103&sid=aV8MMkwMWLwY&refer=news

By Manash Goswami and Hector Forster

Jan. 24 (Bloomberg) -- President George W. Bush's decision to double the emergency oil stockpile in the U.S. may help to stem a six-month slide in prices as China, India and South Korea bolster their defenses against shortages as well.

Oil gained the most since September 2005 yesterday after the U.S. government said it will increase the Strategic Petroleum Reserve to 1.5 billion barrels over 20 years. China, where imports rose 15 percent last year, began to fill its backup tanks in October. India also plans to double its inventories.

The U.S. plan ``helps puts a floor in the market,'' said Antoine Halff, head of energy research at Fimat USA Inc. in New York. ``It creates competition for the same barrels. It tightens the market on top of the strategic reserve builds elsewhere such as China.''

The U.S. government this spring will start buying 100,000 barrels a day to fill its existing storage facility to capacity of 727 million barrels, Energy Secretary Samuel Bodman told reporters on a conference call yesterday. The reserves hold 691 million barrels now.

After that, the facilities in salt caverns along the U.S. Gulf Coast would be expanded to store about 97 days of imports. It will cost $10 billion to build new storage facilities and $55 billion for the extra crude, according to Craig Stevens, an Energy Department spokesman.


Smirky's hanging in there for his oil buds. Can't let the prices drop. After all, I paid only 20c more per gallon yesterday than pre-septembertheeleventh. Smirky cannot let that happen.

[Demeter]

1. How Convenient, As Usual

Picking the public purse for the oil cartels again. It never gets old, does it, Dubya?

[yellerpup]

2. Expensive gas is the reason this guy is pResident

It is a given that oil prices will skyrocket now, thanks to his announcement that he is doubling the oil reserves. Nothing even sneaky about it, so we don't need to be sneaky either. We just need to impeach. NOW! K&R! :kick:

[gratuitous]

3. A "floor in the market"?

Gee, weren't $10 billion quarterly profits enough for the Big Oil companies? Now they need government assistance (that is to say, more taxpayer dollars from the Treasury) to keep oil prices up? They can't just sort of coast on the highest profits ever in the history of the world for a few months?