(Bloomberg) -- Oil edged higher as U.S. President Joe Biden faced more calls to tap the Strategic Petroleum Reserve to try to tackle surging gasoline prices and push back against inflation running at the fastest pace in decades.
West Texas Intermediate added 0.4% in early Asian trading after dropping for three straight weeks. At the weekend, Senate Majority Leader Charles Schumer urged Biden to tap the emergency reserves, saying that consumers needed immediate relief at the gas pump. A top administration aide, Brian Deese, declined to say whether the president would tap the SPR.
The global oil market has fixated in recent weeks on a potential release from the reserves after crude hit a seven-year high in October, lifted by a rebound in consumption from the impact of the pandemic. A plea by Biden for the Organization of Petroleum Exporting Countries and its allies to raise crude production more quickly was rebuffed, putting the focus on how the U.S. administration may respond as the pace of consumer price gains accelerates.
The challenge from inflation, especially gasoline, is a mounting political problem for Biden. The president’s approval rating sank to a new low, according to a Washington Post-ABC News poll. About half of Americans overall, as well as independents, blame him for accelerating inflation, it showed.
Deese, the director of the White House National Economic Council, told CNN: “The president has made clear that all options are on the table.” He added: “We’re monitoring the situation very carefully.”
While oil markets remain backwardated -- a bullish pattern marked by near-term contracts trading above longer-dated ones -- that’s eased in recent weeks. Brent’s prompt spread was a $1.04 a barrel premium on Monday, down from $1.34 a barrel two weeks ago.
©2021 Bloomberg L.P.
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