Trump Proposes Selling Off Half U.S. Strategic Oil Reserve

[jpak]

Source: Bloomberg

The White House plan to trim the national debt includes selling off half of the nation’s emergency oil stockpile and the entire backup gasoline supply, part of a broad series of changes proposed by President Donald Trump to the federal government’s role in energy markets.

Trump’s first complete budget proposal, released Tuesday, would raise $500 million in fiscal year 2018 -- and as much $16.6 billion over the next decade -- by drawing down the Strategic Petroleum Reserve.

“We think it’s a responsible thing to do," Mick Mulvaney, head of the White House Office of Management and Budget, told reporters. The “risk goes down dramatically when we have increased domestic production like we have today.”

The proposal also seeks to boost government revenues by allowing drilling in the Arctic National Wildlife Refuge, ending the practice of sharing oil royalties with states along the Gulf of Mexico and selling off government-owned electricity transmission lines in the West. Like much of the budget, those moves are likely to face opposition on Capitol Hill.

<capy>

Read more: https://www.bloomberg.com/politics/articles/2017-05-23/trump-proposes-selling-off-half-the-u-s-strategic-oil-reserve

[Achilleaze]

1. Thereby making America dependent on Russian oil

How republican is that?

[Nictuku]

4. Ding Ding Ding! +1000

[lastlib]

16. So we can have cash to buy from Rosneft--make that stock go up

Yep. Welcome to tRumputinWorld.

The dots are lining up.

[Panich52]

28. More specifically, Tillerson Exxon-Russian oil

[dalton99a]

29. And soon, Arctic oil

[Cosmocat]

34. It can't possibly be any more apparent ...

nm

[Else You Are Mad]

2. This proves that Trump is a failure of a businessman.

Oil has been at all time lows for the last year or so. Thus, we would be buying high and selling low. Last time I checked that does not make a profit. Also, the few billions that it would make the federal government is just a small drop in the bucket.

But, look at who this does benefit. (Hint: oil companies and Russia.)

[louis-t]

43. Dumpy is known for doing that.

The shittiest businessman in the world would sell strategic reserves at rock bottom prices to pay for a tax break for himself.

[Phoenix61]

3. End royalties to Gulf States

Because Lousianna, Mississipi, and Alabama are just rolling in the cash. That should make all the Trumpsters there just happy as heck they voted for him.

[LeftInTX]

17. You forgot about Texas. We're down at the bottom too.

[Phoenix61]

18. Oops, I did

Sorry about that. Yeah, they won't like that a bit and after all the support they've shown Twitler. Be great dem campaign talking points.

[packman]

5. I am a complete idiot in these type of things

BUT - even I know that somewhere, sometime down the line those reserves are going to have to be refilled. Then, who - I ask already knowing the answer - will benefit?

[jpak]

8. Not you or I

That is certain

[Renew Deal]

6. The Saudi's planted that in his head.

That way we can rebuy the oil at a higher price

[jpak]

9. "place your hand on the orb - and repeat after me"

[Renew Deal]

31. lol

[riversedge]

41. Trump is hearing voices.

[Gidney N Cloyd]

7. What part of "Strategic" don't these guys understand?

[Retrograde]

22. Or "reserve" for that matter (n/t)

[keithbvadu2]

42. It would be "strategic" for Putin.

[truthisfreedom]

10. The last person who spoke with 45

Explains 45's thoughts.

[Else You Are Mad]

44. Trump seriously makes Bush seem like he had original thoughts. Nt.

[bora13]

11. russia loves that

and any enemy of the US loves that.

The strategic supplies are for the need in time of crisis or war.

[FBaggins]

33. Russia most certainly does not love that

The persistently low price of oil globally has hurt them tremendously.

The US selling off hundreds of millions of barrels of reserve sends the message that OPEC has lost control of the market and that the US sees further production gains within the US (reducing the danger from international supply crunches). It would also drive the current price down by exacerbating the current glut in the market.

None of that makes Russia happy.

The better criticism is to pay attention to what the price of oil was when the US was buying up that reserve, compared to the depressed price caused by the sale. "Buy high and sell low" doesn't make Trump look very smart.

[bora13]

37. the point was

that russia knows this will diminish US strategic reserves and that is good for them as an adversary,

and bad for US.

[Calista241]

40. The strategic reserves were started after the 1975 oil embargo.

There is approximately 38 days of oil at daily US consumption rates in the reserves. And it is stored as crude oil, in both sweet and sour formulas. All of it will be in need of refinement if widespread use of the reserve becomes necessary.

Current value of the SPR is $43.5B and the price originally paid for the oil was $20.1B.

Personally, I think this is a good thing. Any Future shocks to the oil market will only drive the US economy to renewable energy.

[FBaggins]

45. I got that.

My point was that your point didn't make sense.

With excess capacity globally and US production approaching record levels, the amount of oil needed as a cushion in case of a supply shock is decreased... and net imports weren't what they once were (making it less of a "strategic" need)

More importantly, the move directly hurts the Russians by driving prices down.

If Trump wanted to implement a policy that helped the Russians, he would find a way to hurt the fracking companies and restrict the growth of US production.

[bora13]

47. national defense

is what strategic reserves are best known for.

[C Moon]

12. I'll wager that President Obama is rolling his eyes and shaking his head.

[Guy Whitey Corngood]

13. So all that shit Pukes were spewing the previous 8 years about foreign agent, blah, blah, blah was

true. With the exception that they had the wrong guy and wrong year.

[Saviolo]

14. You can't balance the budget by selling off assets!

Because, surprise surprise! Assets run out eventually!

You want to reduce the debt? Have a budget that's in surplus with revenue (i.e.: Taxes!) that fills the shortfall! If there are people or corporations not paying their fair share of taxes, close the loopholes! If they threaten to take their business elsewhere, ask them what they've done for us lately!

Republicans have been lowering tax rates on corporations for years now, and they've been promising more jobs in return. Where are the jobs? Oh, right, labour hurts the bottom line. Since productivity is up and wages are down, there's no reason to add new jobs! Woo, end-stage capitalism!

[jmowreader]

15. Interesting that he'd suggest this when he did

The Strategic Petroleum Reserve was founded in the wake of the Arab Oil Embargo. The idea was, if the Persian Gulf gets pissed at the US over our support for Israel (as was the cases belli for the Arab Oil Embargo of the 1970s) and does another embargo, with a huge amount of oil to draw from we'll have six months to make nice with the guys who padlocked the spigots.

We still buy a lot of Persian Gulf crude. The "interesting" becomes suspicious when you realize just a couple days before he came up with this, the Saudis gave him a gold medal, threw a big party for him and bought $110 billion worth of tanks, helis, ships and missiles from the US.

Getting rid of the SPR enables the Saudis to screw Israel for free..."America, quit supporting Israel or we'll quit selling you oil'".... which is probably why they suggested it. The word "strategic" is not in Trump's vocabulary; if he can't build apartments or golf courses on it, he has no interest in it.

[Phoenix61]

19. Then we really will need that nice Russian pipeline

Tillerson has been drooling over. Twitler is just such a stupid, stupid tool, kinda like a left-handed wrench.

[OnlinePoker]

20. 2/3 of the SPR is high sulpher sour crude

There is a lot less refining capacity for this type than light sweet crude and it generally sells at a discount. Current average cost for crude in the SPR according to DoE is $29.70 per barrel so "profit" by selling half would be less than $20 per barrel.

[Sen. Walter Sobchak]

35. It's intended to be used for bunker fuel is it not?

[liberal N proud]

21. It will drive prices at the pump higher

[not fooled]

23. Which is the goal

How are Putin and the Saudis going to replenish their treasuries and continue looting their countries unless prices go up at the pump?

Idiots who voted for dump don't realize that when gas goes back up to $4-5/gallon (remember that, under chimpy?), they will be in effect paying 100s of dollars a year in a "tax" to private interests.

[benld74]

24. a responsible thing to do is LEARN TO ADD

The BUDGET is cooked. ADMIT IT

[Yo_Mama_Been_Loggin]

25. The guy is a blithering idiot

[Blue Meany]

26. Who could possibly imagine that when we need that gas, the price will have gone way

up? While we're at it, let's sell off the White House (great spot for a Trump Hotel) and the Lincoln Memorial (shouldn't have phallic symbols like that in public places).

[Alice11111]

39. He's already doing away with the monuments. The

Unthinkable is happening.

[Panich52]

27. Great idea. Make up cost of cpl of his trips to FL while

decreasing our supposed energy independence (already cut by revoking ban on selling US oil). File under oxymoron "Trump logic"

[MedusaX]

30. What the fuck else has he & KGOP used as an IOU ?

Unbelievable....

Whatever happened o selling one's own soul?

These guys have leveraged the physical assets of US and the constitutional freedoms of the people...


As if taxation WITH OUT representation was not bad enough...

Now we have to underwrite
their "privileged life style"
while they fuck us out of
Every aspect our meager existence...

[Tanuki]

32. ........

[furtheradu]

36. Kick for more eyes!

Another ridiculous un-American republiker trump idea.

[Alice11111]

38. Some sources say more than 1/2. Supply exceeds demand

now. However, the sell off of the reserves will eventually help to change that and drive prices up, as fuels will be more dear. Driving prices up is the goal.

However, he is making us vulnerable unnecessarily to things and times unknown. For what? So he can add a few bucks to help balance his fictional budget. Not really, it is to make us more vulnerable to short term events, so prices go up. Of course, this benefits Trump, Saudis, & the Russians (which also overflows Trump's wallet). It will hurt the poor, reduce travel and growth.

Hopefully, he will eventually be in jail, and can't enjoy it. However, he has hired teams of lawyers. I think he will negotiate his way out of jail, but disgraced, like Nixon. Actually, it's sort of an oxymoron to say DT is disgraced.

[MiniMe]

46. What could possibly go wrong?

[sarcasmo]

48. This sounds like a plan straight from Rosneft.