icon bookmark-bicon bookmarkicon cameraicon checkicon chevron downicon chevron lefticon chevron righticon chevron upicon closeicon v-compressicon downloadicon editicon v-expandicon fbicon fileicon filtericon flag ruicon full chevron downicon full chevron lefticon full chevron righticon full chevron upicon gpicon insicon mailicon moveicon-musicicon mutedicon nomutedicon okicon v-pauseicon v-playicon searchicon shareicon sign inicon sign upicon stepbackicon stepforicon swipe downicon tagicon tagsicon tgicon trashicon twicon vkicon yticon wticon fm
13 Mar, 2020 21:26

Every plague has a silver lining! Trump cashes in on oil price drop with order to ‘FILL UP’ US reserves with cheap crude

Every plague has a silver lining! Trump cashes in on oil price drop with order to ‘FILL UP’ US reserves with cheap crude

With oil prices cratering worldwide, President Trump added an extra order to his list of executive responses to the coronavirus pandemic: buy up crude oil and fill the US’ reserves to the brim.

“Based on the prices of oil, I've also instructed the secretary of energy to purchase, at a very good price, large quantities of crude oil for storage in the US strategic reserve,” Trump told reporters at the White House. “We're going to fill it right up to the top.”

Also on rt.com Trump declares national emergency over coronavirus pandemic, unlocking $50bn in funding

Trump’s order will see the US snap up a bargain, as crude oil prices have just suffered their worst week since 2008, dropping to around $30 per barrel. The drop was caused by reduced demand due to the coronavirus panic, and an ongoing price war between Russia and Saudi Arabia, neither of whom have cut output to match the reduced demand.

By stocking up the reserves, Trump can protect US energy companies from potential coronavirus-related disruptions to supply, or release more oil to insulate the market against price shocks once demand rebounds.

The decision to “fill it right to the top” comes after a group of oil lobbyists met with the president on Wednesday, urging him to capitalize on the downturn and snap up cheap crude oil during the dip.

Also on rt.com At least Trump is honest: Let ‘adversaries’ fight Islamic State while US steals the spoils

The president did not say exactly how many barrels would be bought, but according to Reuters, the strategic reserve currently has the capacity to store an additional 77 million barrels, on top of the 635 million currently held in storage in Texas and Louisiana.

Though one line in a lengthy press conference, Trump’s announcement immediately caused oil prices to pitch upwards again.

Like this story? Share it with a friend!