Oil prices to come under pressure again? Biden administration plans to release oil reserves to curb gasoline price hikes

According to the latest information from Zhitong Finance and Economics, the Biden administration is preparing to release more oil from the U.S. strategic petroleum reserve to prevent the rise in gasoline prices this summer. White House senior advisor Amos Hochstein stated that oil prices are "still too high for many Americans," and he hopes to see further declines in oil prices. However, oil prices saw the largest weekly increase in a week, as overall market risk sentiment overshadowed the mixed impact on crude oil prospects. The U.S. stock market is booming, with the S&P 500 index hitting its 30th record high of the year, despite the Federal Reserve lowering its expectations for interest rate cuts this year. The overall optimistic market sentiment is driving up oil prices. After WTI crude oil rose by 2.4% on Monday, trading prices surpassed $80 per barrel, and Brent crude oil closed above $84 per barrel. The near-month crude oil contract for July on the New York Mercantile Exchange rose by 2.4% to $80.33 per barrel, while the near-month Brent crude oil contract for August rose by 1.9% to $84.25 per barrel, marking the highest settlement prices for these two benchmark prices since April 30. In addition, U.S. natural gas futures fell for the fourth consecutive trading day, with the near-month contract for July on the New York Mercantile Exchange dropping by 3.2% to $2.788 per million British thermal units. Crude oil futures surged to their highest level since the end of April, doubling in price after reports from OPEC+, the International Energy Agency (IEA), and the U.S. Energy Information Administration (EIA) boosted confidence in improved oil demand in the second half of the year. The increase in oil prices this month has reduced the quarterly decline, as OPEC+ agreed to extend supply cuts, with any further decisions depending on market conditions. Asian demand seems slightly weak, with signs of a decline in gasoline consumption in India. According to reports, Saxo Bank analyst Ole Hansen wrote, "The strong outlook for fuel demand in the next quarter, Saudi Arabia's assurance on the restoration of supply in October depending on the current situation, and more attention to canceling quotas to reduce production and align with it seem to be supportive." However, Rabobank analyst Robert Yawger attributed Monday's rally to speculative buying and added that this rally could fade at any time. Yawger stated that for the crude oil market to rise significantly due to fundamental factors, gasoline demand during the summer driving season needs to improve significantly. However, he expressed doubts about the prospect of U.S. gasoline demand rebounding as the summer approaches. BOK Financial analyst Dennis Kissler stated that most of the rally is technical, as the market believes that U.S. fuel demand will heat up as the summer driving season progresses. He pointed out that after the near-month contract crossed above the 200-day moving average, buying accelerated near midday. The American Automobile Association reported that as of last Sunday, the average gasoline price in the United States was $3.45 per gallon, slightly lower than a year ago, but more than 50% higher than when President Biden took office in January 2021