Global oil prices turned higher Tuesday, adding more than $1 a barrel to WTI crude, in the wake of President Joe Biden's decision to release 50 million barrels of crude from the Strategic Petroleum Reserve.
Biden's decision, the first sale of SPR crude in more than a decade, was met with commitments from China, India, Japan, South Korea and the United Kingdom that could lift the collective increase to around 100 million barrels over a number of weeks.
The decision comes amid surging gasoline prices in the United States and an ongoing energy crunch in China that has hit factory output and added new pressures to global supply chains.
Oil prices have rallied more than 50% this year as both the China and European energy crunch triggers fresh crude buying - a dynamic OPEC leaders have largely dismissed as the hold to previous plans that only include modest changes to the cartel's daily production targets.
However, the move also comes just days ahead of a December meeting of OPEC ministers in Vienna, many of whom have resisted calls to quicken the pace of paring their years-old agreement on production cuts, which have helped lift global crude prices to the highest levels in seven years last month.
OPEC, in fact, cut is 2021 demand forecast earlier this month by 330,000 barrels per day -- a figure that nearly matches the 400,000 barrels it has committed in increased production -- arguing that surging COVID infection rates in Europe will slow industrial purchases and rising share production in the United States will ultimately boost global supplies.
WTI futures for January delivery were marked $1.50 higher on the session at $78.25 per barrel while Brent crude contracts for the same month, the global pricing benchmark, jumped $2.21 higher to $81.70 per barrel.
Oil prices rose 12% in the two weeks following President Barack Obama's decision to release 30 million barrels from the SPR in June of 2011 to offset supply disruptions linked to the civil war in Libya.