- The U.S. announced a record-breaking SPR release of 180 million bbls.
- Assuming that the SPR hits between May 6 to Oct. 14, US commercial crude storage will build during the summer months.
- US crude storage with SPR is set to fall below ~800 million bbls as the unprecedented SPR release goes straight into an oil market deficit.
- Oil price volatility will remain high. Depending on exactly how much crude exports Russia loses, this SPR release could be very meaningful or very meaningless.
- Stay long energy equities. They remain undervalued relative to where oil is today even following the SPR announcement.
For further details see:
Oil Prices Fall On SPR Announcement: What Does This Mean Going Forward?