WASHINGTON (Reuters) -The U.S. Energy Department has talked to oil producers and refiners to ensure stable fuel supplies at a time of rising gasoline prices, Jared Bernstein, head of the White House Council of Economic Advisers, said on Wednesday. Rising gasoline prices were largely behind the largest increase in U.S. consumer prices in 14 months in August. “The Energy Department is in touch with producers and refiners to resolve any issues and to try to ensure stable supply,” Bernstein told reporters on Wednesday. Officials from President Joe Biden’s administration reached out last week to oil industry companies to assess inventory levels and learn of any planned shutdowns of refineries, after Saudi Arabia and Russia extended voluntary oil output cuts to the end of the year, a U.S. refining source involved in the talks told Reuters. “The White House wants to make sure everyone is focused here on potentialities for systemic disruptions that could create a supply problem,” said the source, who is not authorized to speak publicly about internal discussions. Gasoline prices jumped 10.6% in August after climbing 0.2% in July, accounting for more than half the increase in the Consumer Price Index. They peaked at $3.984 per gallon in the third week of August, according to data from the U.S. Energy Information Administration, up from $3.676 per gallon during the same period in July. Gasoline prices are expected to rise further in some regions during US refinery maintenance this autumn, especially given the additional impact of Saudi Arabia’s extended production cuts on crude oil prices. The Energy Department did not immediately respond to requests for comment. The American Petroleum Institute, the top U.S. oil lobby group, said the Biden administration has “taken every opportunity to restrict production both now and in the future.”

“This administration has delayed a 5-year program for offshore exploration, stymied infrastructure development, removed millions of acres from leasing in the Gulf of Mexico, and revoked leases in Alaska, all while pushing costly and ineffective policies designed to limit consumer choice. It doesn’t have to be this way,” the group said in a statement.

Last summer, Biden officials held a series of talks with U.S. refiners as inflation was crushing consumers and gas prices hit historic highs. The White House at the time floated ideas like curbing fuel exports and forcing the restart of idle refineries, but those ideas have not been resurrected yet, the source said. Biden authorized large withdrawals from the nation’s Strategic Petroleum Reserve to combat high prices, leaving it at its lowest level in decades. Tapping it again this year would be a risky move. The SPR currently holds about 350 million barrels. The Biden administration has only begun refilling it sporadically and last month pulled back an offer to buy back a batch as oil prices were rising due to the Saudi output cut. NN: They are not going ti sit back and do nothing as oil shoots higher. This is how election are lost. The most watched prices by consumers is gasoline. I have seen them intervene over and over again to cap oil rallies.

Crude oil prices ticked lower today after the Energy Information Administration reported an inventory build of 4 million barrels for the week to September 8. This compared with a draw of 6.3 million barrels for the previous week, which in turn followed another massive inventory decline of 10.6 million barrels for the week before that.

EIA: US crude inventories up by 4 million barrels

The Biden administration informed Congress on Monday that it has taken concrete steps to carry out a prisoner exchange with Iran, issuing a waiver that will give Tehran access to $6 billion in Iranian oil revenue that had been blocked by U.S. sanctions, according to a State Department document sent to Congress and obtained by NBC News. Secretary of State Antony Blinken last week issued a sweeping waiver to international banks allowing the transfer of $6 billion in frozen Iranian funds from South Korea to Qatar without the threat of U.S. sanctions, according to the State Department report notifying Congress of its decision. Iran will then be permitted to use the funds to buy food, medicine or other humanitarian items allowed under U.S. economic sanctions.  In addition, the administration told lawmakers it would free five Iranian nationals under detention in the U.S. in exchange for five Americans held in Iran, according to the document. The move is the latest sign that the prisoner exchange is moving ahead. “This remains a sensitive and ongoing process,” she said. “We have kept Congress extensively informed from the outset of this process — long before today — and we will continue to do so, including with additional already scheduled briefings this week.”

OPEC+ is in a good position to keep oil at around $85 per barrel, according to a new report from Skandinaviska Enskilda Banken AB (SEB), which was sent to Rigzone earlier this week. “We expect OPEC+ to be in solid control of the global oil market over the next couple of years as U.S. shale oil production slows to a trickle,” SEB analysts Bjarne Schieldrop, the company’s Chief Commodities Analyst, and Ole R. Hvalbye, noted in the report.

“An oil price of $85-90 per barrel should be a good balancing point for consumers and producers,” the analysts added.

In the report, the analysts stated that OECD commercial oil inventories are up 111 million barrels over the past year but added that U.S. strategic petroleum reserves over the same period have declined “by almost the same amount – 95 million barrels”. “The global oil market has thus been nearly balanced over the past year with no real increase in OECD inventories when the decline in U.S. SPR is considered,” the analysts said in the report. The analysts also highlighted in the report that Saudi Arabia produced 10.5 million barrels per day in April “but then rapidly drew it down to only 9.0 million barrels per day in July to September”. “This did wonders for the oil price, which has shot back up to around $85 per barrel,” the analysts stated in the report. “This [is] exactly where we think Saudi Arabia wants to keep it if it can. It yields sufficient income while it is not so high that it stirs too much political kickback from its customers,” they added. “The current deep cuts by Saudi Arabia – in which Russia will participate with a 0.3 million barrel per day cut in September – are probably way too deep if the IEA is correct in its calculations. It estimates that the need for oil from OPEC is 30 million barrels per day in Q3/23 and 29.8 million barrels per day in Q4/23,” they continued.The analysts noted in the report that Saudi Arabia would need to produce closer to 11 million barrels per day for OPEC to reach this level and not the 9.0 million barrels per day it is producing now.

“We think Saudi Arabia will add supply in Q4/23 to prevent the oil market overheating,” the analysts said in the report.

The analysts also highlighted in the report that the IEA estimates that the world will need OPEC to produce 29 million barrels per day in 2024. “That is down 0.3 million barrels per day from 2023 as non-OPEC supply is projected to grow faster than global demand,” the analysts said. “If the non-Saudi producers within OPEC produce the same in 2024 as they so far have done in 2023, then the need for oil from Saudi Arabia in 2024 will be 10.3 million barrels per day. That is more than what it looks like Saudi Arabia will produce this year and more than its average production during 2015-19 of 10.1 million barrels per day,” they added. “So Saudi Arabia looks set to be perfectly fine in 2024 with good control of the market with ability to both lift and reduce production and keep the oil price just where it wants it to be. And with Saudi production now below Russia’s, it won’t have to do all the heavy lifting itself,” the analysts went on to state. If “painful cuts” are needed in 2024, then Russia will join in with deliberate cuts, according to the analysts. The SEB analysts noted in the report that U.S. shale oil production has been steadily cooling since early December “with drilling rig count falling even at a WTI price of $80 per barrel”. “This change in behavior has handed a lot of market power back to OPEC that it and Saudi Arabia are currently exercising and will continue to exercise in the coming years,” the analysts said in the report.

“The biggest risk to Saudi Arabia’s control of the situation would probably be a sudden revival of lost production by OPEC laggards like Venezuela, Iran, Nigeria, Angola, and Libya,” they added.

The total U.S. rig count currently stands at 631, according to Baker Hughes’ latest rotary rig count, which was released on September 1. This count is down 129 rigs year on year, the count showed, highlighting that the U.S. has cut 84 oil rigs and 48 gas rigs, and added three miscellaneous rigs, compared to this time last year. In its latest short term energy outlook (STEO), which was released last month, the U.S. Energy Information Administration (EIA) projected that U.S. crude oil supply would come in at 12.76 million barrels per day this year and 13.09 million barrels per day in 2024. Production from the Lower 48 states, excluding the Gulf of Mexico (GOM) was projected in the STEO to be 10.52 million barrels per day in 2023 and 10.81 million barrels per day in 2024. Brent rose from a close of $72.26 per barrel on June 27 to a close of $87.55 per barrel on August 9, before dropping to a close of $83.36 per barrel on August 24. The commodity rose to close at $90.04 per barrel on September 5. At the time of writing, the price of Brent crude oil is trading at $89.28 per barrel. The EIA projects in its August STEO that the Brent spot price will average $82.62 per barrel this year and $86.48 per barrel next year. In a report sent to Rigzone last week, Standard Chartered predicted that the ICE Brent price would average $91 per barrel this year and $98 per barrel next year.

In a separate report posted on SEB’s website on August 29, Schieldrop noted that SEB’s view is that Saudi Arabia will not risk driving crude oil prices to $100-110 per barrel or higher through deliberate cuts “as this will lead to elevated political storm from the U.S. and maybe also from China”.

“We think that Saudi Arabia is utterly happy with the current oil price of $85 per barrel and want to keep it at that level. Getting it exactly right is of course tricky, but they do have the capacity to at least get it ballpark right,” he added in that report. NN: They got oil in the sweat spot. $85 WTI is a number everyone can live with. If they push things to far a lot of new barrel will come into the market…… And a political shit storm… Which they don’t need right now. They have made their point.

Alaska officials outraged after feds cancel Trump-era ANWR oil leases: ‘Pulling the rug out’

Alaska state officials criticized the Biden administration’s latest move to curb oil and gas drilling in the Arctic, following the cancelation of seven Trump-era leases in the Section 1002 area of the Arctic National Wildlife Refuge.  The leases were purchased by the Alaska Industrial Development & Export Authority in the waning days of the Trump administration, the state agency told Fox News Digital. The Interior Department called the cancelation of the leases one of many “significant steps” the Biden administration has taken to protect ANWR. The move will accentuate President Biden’s “historic conservation and climate agenda,” the department said in a statement. Interior Secretary Deb Haaland, who authorized the cancelation, cited climate change warming the Arctic region more than two times the rate elsewhere on Earth. She said that such steps will “further [our] commitment, based on the best available science and in recognition of the Indigenous Knowledge of the original stewards of this area, to safeguard our public lands for future generations.”

Biden previously pledged to protect 19.6 million acres of the ANWR region for the sake of polar bears and caribou, according to Reuters.

In response, AIDEA executive director Randy Ruaro told Fox News Digital in an interview Wednesday the cancelation appears to be a fulfillment of a Biden campaign promise to halt oil and gas production on federal lands.

“This is just another area where he’s attempting to just shut down oil and gas production,” Ruaro said, adding that halting speculation and production will curtail thousands of potential job opportunities, especially for those living in and around ANWR.