In this special programme for BBC Arabic, Dr Carole Nakhle, CEO of Crystol Energy, explains the purpose of the Strategic Petroleum Reserves (SPR) and the impact of their release by the US and the International Energy Agency (IEA) on oil markets.
Dr Nakhle argues that the main function of the SPR is to act as a safety cushion in periods of crisis to counter supply disruptions. Today, consumers fear disruptions to Russia’s oil supplies and subsequent higher oil prices. In this context, the release of the largest SPR volumes in history is used to counterbalance potential disruptions from the world’s second largest oil exporter.
Meanwhile, OPEC has stuck to its production plan arguing that current market fundamentals do not justify further increases in production. The release of the SPR will lend further support to its decision.
Watch the programme:
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