Oil falls after report says Trump is considering tapping the emergency oil reserve

Oil prices bounced around Friday afternoon following reports that the Trump administration could tap an emergency oil reserve ahead of the midterm election.

West Texas Intermediate fell 0.5% to $US70 a barrel at 3:25 p.m. ET. Crude, the international benchmark, rose 0.75% to $US75.09.

The Trump administration is “actively considering” a release from the Strategic Petroleum Reserve, the world’s largest oil stockpile, sources told Bloomberg. Options under review range from a 5-million-barrel test sale to a larger release of 30 million barrels.

The White House did not respond to an email earlier this week requesting comment on whether the administration is considering a release.

The potential release could come ahead of the midterm election in November, where rising prices at the pump could hurt Republicans in competitive races. A release could at least temporarily ease global-supply concerns that have driven energy prices to four-year highs.

The SPR is mainly intended to be an emergency stockpile the US can turn to during war or natural disaster. But non-emergency releases can be authorised to respond to minor supply disruptions or to raise federal revenue, according to the Energy Department.

WTI is up 52% year-over-year.

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.