The SPR Release

November 25, 2021:

• refiners operating at 86% operating capacity; not because shortage of oil; plenty of oil
• released oil will be delivered to / sold to China / India
• why did price of oil go up? reasons:
• oil released was heavy, sour oil
• US refiners need light oil to balance heavy, sour oil to refine
• if refiners take that heavy, sour crude they will need more WTI (light oil) / Brent (also light oil) to balance the heavy, sour oil that was released (that needs to be fact-checked; I haven't seen source for "wrong kind of oil" -- accurate or simply a meme?)
• other possibility for price increase, at least for oil company equity (stocks)? algorithms
  

November 25, 2021: the SPR release, where we stand --

• $5 / bbl gift to Big Oil; backwardation; it's a swap; oil companies replace expensive oil (which they get for free "today") which cheaper oil in the future
• takes a minimum of thirteen days to get this new oil to refineries so will have no effect on refiners until well after Thanksgiving;
• refiners currently operating at 86% capacity; already a glut of oil;
• most oil released from SPR will be delivered to / sold to China and India
• the big question is why did the price of oil "recover" immediately after the release announced
• I think it has to do with the algorithm(s)