The economist of the University of Houston Dr. Ed Hirs said Donald Trump is planning to sell strategic crude oil inventories of the US within 10 years and it will negatively affect US oil producers. According to Hirs the Trump government plans to generate $ 16.6 billion in revenue by selling half of the oil stocks of the US at about $ 48 a barrel over the next 10 years.
He added that the strategic crude oil inventories in the US are about 688 million barrels, and Trump government will sell half of the oil stocks at about $ 48 per barrel in the next 10 years. Trump plans to generate $ 6 billion in revenue, which will negatively impact US oil producers. Trump government and US oil producers will encounter if the plan goes ahead.
Reminding that the price of the West Texas crude oil in the United States is currently around $ 51, Hirs said that it is very difficult for US Petroleum producers to sell oil below this level and to compete with the Trump government.
Noting that strategic crude oil stocks in the world are an important support in situations such as war, natural disaster and possible interruption of supply in the global oil market, he stated that political calculations should not be made on these strategic resources.
On the other hand, the impact of the plans of Trump government for selling strategic crude oil of the US on the global markets is another issue being discussed. Thomas Pugh, an expert of Capital Economics, an independent research firm in London, pointed out that the Trump government’s selling crude oil stocks would not significantly affect crude oil prices on the global market. Describing that the US has doubled crude oil production while oil imports decreased by 30 percent in the last 10 years, he said holding such a large strategic oil is not wise.