1. US Shocks Market with Largest Ever SPR Release

– US President Joe Biden announced the release of 180 million barrels of crude from the strategic petroleum reserve over the next six months, equivalent to 1 million b/d.

– Most American SPR stocks are medium sour barrels held in salt caverns across Louisiana and Texas, so the release would be primarily interesting for sophisticated refiners.

– This is six times larger than the previous outright SPR sale and will reduce the remaining strategic inventories to a mere 388 million barrels by the end of the stock draw.

– Should the SPR release be done as an exchange, the deal might push oil prices even higher as refiners have to replace the barrels plus interest in the form of extra crude, effectively taking away barrels from the market, Bloomberg writes.

2. Russian Gas Still Flowing to Europe Amid Currency Spat

– Russia’s President pledged to cut off its gas supplies to customers unwilling to pay for their deliveries in Russian roubles, alarming most of Europe’s business community.

– Under the presidential decree, buyers must open accounts in Gazprombank and pay directly, instead of the previous practice of using European banks to wire the funds.

– Despite the media hullabaloo, European customers continue receiving stable supplies, pushing spot TTF prices down by some €15/MWh on Friday (trading at the equivalent of $40/mmBtu).