Originally Posted by Rebellion

I just completed a class on oil investments. One of the most interesting items learned was that the strategic oil reserves are not funded by the government buying it on the open market like any other. They own land leases where the oil companies drill. Per the contracts, none of them are allowed to pay their rent with cash. Instead, 1 out of every 10 barrels drilled must be given to the US to fill the strategic reserve in lieu of cash payment. By suspending the filling of the reserve the government will instead have an IOU from the oil companies for x barrels of oil to be filled at their request in the future. So that means Exxon et al now have an extra 10%+ of oil to sell on the market. And what does that mean? It means next quarter Exxon's profits are going to grow in the 10% range. Of course that also means three months from now politicians (almost all of which will be Democrat) will complain about huge Exxon profits in a time of crisis, despite the fact that they caused this most recent growth spurt with this legislation. Of course it also means many on this board, who will be almost exclusively Democrat, will complain about Exxon's growth in profits not knowing that their party contributed to this growth.