Important Takeaways:
- America’s emergency oil reserve is at a 40-year low — and that could inflate oil prices, Goldman Sachs says
- America’s emergency oil stockpile has plunged to 40-year lows. The shrinking Strategic Petroleum Reserve is limiting Washington’s ability to shield consumers from the fallout of Saudi Arabia’s aggressive supply cuts, according to Goldman Sachs.
- “At this point, US energy policy has fewer bullets left. It has less levers left in its policy toolkit,” Daan Struyven, head of oil research at Goldman Sachs, told CNN in a phone interview.
- That’s one reason Goldman Sachs expects oil prices to stay high, averaging $100 a barrel this time next year. Triple-digit oil would boost already-high prices at the pump, worsening inflation and potentially influencing the 2024 race for the White House.
- To cushion the blow from the war in Ukraine, the Biden administration has released vast amounts of oil from the SPR, the underground series of storage tanks along the Gulf Coast that contains emergency oil.
- Industry veterans say that strategy helped mitigate the hit to consumers as gasoline prices plunged after hitting $5.02 a gallon in June 2022.
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