Quote Originally Posted by Seran View Post
2. Umm, no? The IEA treaty requires it's member countries to keep 90 days worth of NET imports within the reserve. The US is one of 6 IEA member countries who is a NET EXPORTER and not required by treaty to hold stocks. The coordinated release of oil was a massive boon to industry and our country, and the sale was actually as much an EXCHANGE for FUTURE DELIVERIES as it was a sale. There is no legally mandated timeframe for stocks to be returned to the SPR. According to a May 2022 report, the average price for the oil within the SPR was $29.70 per barrel.

3. While you're correct that wage growth CAN result in COST-PUSH inflation, corporations CHOOSE when/if those increases are pushed off to customers. For example, Taco Bell has increased it's nationwide wages north of $14.00 per hour, yet their menu prices have scarcely changed despite that amount vastly exceeding minimum wage in areas. This is an example of a corporation allowing it's PROFITS TO SHRINK in order to preserve demand.

On the flipside, Big Oil on average produces oil at an average cost of $35 per barrel. While it resells at $117 per barrel. For those Big Oil conglomerates who also have refining capacity, they refine and resale the products at the equivalent profit of $155 - $275 PER BARREL of oil just at the wholesale rate. Big Oil collectively made the choice to increase their prices WELL AND BEYOND what the traditional profit margin is for oil distillates and are raking in RECORD BREAKING PROFITS.

Get your facts straight.
I'm just going to skip the whole oil thing, since you are just regurgitating NYT and White House press releases.

However, let's use your Taco Bell example and expand a bit, since you like to grab only the pieces of the equation that still yield a result in your favor. In the rising rate, tighter lending environment that we now find ourselves in, Taco Bell through these measures has left themselves only one option to retain profitability once demand destruction occurs. Since they will no longer have the option of raising prices, they can only cut their largest expense, being that costly labor. The system contracts, unemployment rises, and inflation moderates. These are the very mechanisms that you seem to be aware of, but politics clouds your thinking when applying them to the energy sector.

Seems the Biden administration has poisoned the well enough here that it's now willing to travel to beg the Saudis for a political bailout. I can only imagine what that will cost. Assuming anyone even shows up at the airport to greet him.