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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Enigma who wrote (52611)	5/12/2000 10:03:00 AM
From: Hawkmoon	Read Replies (1) \| Respond to of 116759

Enigma, It is not the amount that really matters, but its immediate availability. The primary reason that oil prices remained high even after the March production increase announcement by OPEC, was that their increased oil would require anywhere between 60-90 days to enter the US market. If the SPR had been immediately tapped and then replaced by the oil being shipped from OPEC, it would have smoothed the market volatility. As for the use of the SPR, it is for anytime that the US is faced with a threat to its economic health. After all, that is why most wars are fought also. The Japanese attacked Pearl Harbor because they felt the US was threatening their economic health by cutting off oil shipments to Japan. The Japanese leadership decided they needed to seek its oil from the fields of the Dutch West Indies and Burma and to do that without US interference, they had to neutralize/destroy the US pacific fleet at Pearl. Energy is the lifeblood of any economy as we found out during the '70's embargo. The SPR was established to prevent such an embargo every again having such an impact on the US economy. It gives the US the buffer they needed to bring other sources online, or to respond with energy conservation measure. But what it also does is make the US a major player in the global oil market with the ability to immediately depress the price for that commodity, if only for a couple of months. Regards, Ron