During the early European trading hours of 22 June 2022, oil prices on the world commodity market fell amid pressure from US President Joe Biden, who is systematically and vigorously pushing to reduce soaring fuel prices. It includes pressure on large US companies to help with prices during peak summer demand in the United States, where fuel prices already average around US$ 5 per gallon, with some regions charging as much as US$ 7 per gallon.
On 22 June 2022, at 7:05 am CET, the US West Texas Intermediate (WTI) light crude oil traded on the New York Mercantile Exchange (NYMEX) market at US$ 105.88 per barrel with the current daily decline of -3.32%. However, despite this price decline, according to technical analysis data, the price of WTI oil shows an increase of +63.13% in an annual comparison and since the beginning of this year the price has increased by +46.23%. On 22 June at 7:10 am CET, the European counterpart of WTI, North Sea Brent crude oil traded on the Intercontinental Exchange Europe (ICE) commodity market at US$ 111.15 per barrel with the current daily decline of -3.05%. According to technical analysis data, this current price reflects the fact that the price of Brent crude oil has risen by +47.32% since the beginning of 2022 and its value has increased by +62.77% over the past 52 weeks.
Oil prices on the world commodity market have fallen sharply by more than 3% of their daily price due to pressure from the US administration and President Joe Biden himself, but also according to economic correspondents, due to the inverse ratio of the exchange rate of the USD and the prices of gold, oil and other commodities. According to this inverse rule, what usually happens is that when the USD strengthens the commodity market, and especially oil prices, are in decline. On 22 June at 7:31 am CET, according to the US Dollar Currency Index (DXY), we saw the USD at the price level of 104.71 strengthening by +0.26%. In addition to the fall in oil prices, there was also a fall in gold prices on the commodity market, with investment gold trading at US$ 1,827.60 per troy ounce with a daily decline of -0.609%.
While the United States, and especially President Biden, is struggling to deal with soaring gas prices and inflation, Mr. Biden is expected to call for a temporary suspension of the US$ 18.4 cent per gallon of federal tax on gasoline today on Wednesday, 22 June. A source also revealed to Reuters that on Monday 20 June Biden was considering asking for a tax suspension. “Even oil traders acknowledged that higher oil prices hence higher gasoline prices would lead to a more aggressive tag team onslaught from the (U.S.) Fed pushing rates higher and the Biden administration getting increasingly more creative on the political and fiscal front to tame the energy inflation beast,” said Stephen Innes, Managing Partner of SPI Asset Management. Furthermore, according to economic correspondents, about seven oil companies are due to meet with President Biden on Thursday, 23 June, allegedly under pressure from the White House administration to reduce fuel prices as they achieve record profits. However, according to financial strategists, there is a strong assumption that lowering the price of WTI oil below US$ 100 per barrel will be a significant problem for Mr. Biden, but such a drop in prices cannot be completely ruled out.