10/18/2006

Daily Kos: China begins filling Oil vault, with US dollars

China today starting filling its Strategic Petroleum Reserve, which should reach 100 million barrels.


China begins filling SPR, with US dollars Hotlist
by agent double o soul [Subscribe]
Wed Oct 18, 2006 at 12:27:24 PM CDT

China today starting filling its Strategic Petroleum Reserve, which should reach 100 million barrels. The U.S. SPR is about 700 million barrels and with enterprise storage is double that amount. Beyond the symbolism of this move, there are some hard facts.
* ) China plans to pay for this additional oil with their U.S. dollar reserves. Think about 100 million barrels, times $50 a barrel, sold out of the U.S. Treasury Bond market. China currently holds 1 trillion in foreign reserves.
* ) The global drive to create storage could raise the fill rate to a million barrels a day, about the same amount the Saudi's want to take out of production. Interesting numbers.
* ) The October surprise, lower fuel prices, may have been a move to accomodate the Chinese central bankers, and not the American voters, although selling out the interests of America should not come as a surprise to anyone who knows this administration. The last time we had an American President this vicious and paranoid, relations with China flourished.

Daily Kos: China begins filling SPR, with US dollars

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