Economist Peter Schiff predicted on Saturday that oil prices will soar once the U.S. Strategic Petroleum Reserve (SPR) drawdown ends following the midterm elections in November.
‘The Dollar Will Fall,’ Peter Schiff Says
In a post on the social media platform X, the Echelon Wealth Partners co-founder said that the “main reason it’s [oil prices] not closer to $150 is all the oil being released from the Strategic Petroleum Reserve.” Schiff added that the SPR releases will stop following the midterm elections.
“When it becomes obvious that inflation will outpace Fed rate hikes, the dollar will fall, sending oil prices soaring,” he said, warning against what he thought would be an imminent rise in oil prices on the global markets as tensions escalate between the U.S. and Iran, as well as the Russia-Ukraine war.
According to the Energy Information Administration (EIA), the U.S. SPR, at the end of the second week of October, was nearly 283 million barrels of oil. Notably, the U.S. was offering up to 40 million barrels of oil from the SPR as loans to oil companies.
Iran’s Araghchi Slams Netanyahu
As tensions remain between Washington and Tehran, Iran’s Foreign Minister Seyed Abbas Araghchi warned that Israeli Prime Minister Benjamin Netanyahu was going to drag the U.S. into another war to escape judicial action. Araghchi’s comments came after President Donald Trump endorsed Netanyahu ahead of the elections in Israel.
Meanwhile, Energy Secretary Chris Wright defended Trump against criticism of high energy costs in the U.S. from Democratic lawmakers, saying that the Democrat-led states had higher gas, diesel and electricity costs than GOP-led states.
Oil, Gas Movement
The American Automobile Association (AAA) data on Monday showed that the national average price of gas fell to $4.2953/gallon. Diesel also saw a marginal decline to $6.3187/gallon on Monday, but remained above the $6 mark.
The West Texas Intermediate (WTI) crude futures contracts maturing in December 2026 fell 0.99% to $98.04 at press time. Brent futures contracts ending in December dropped 1.37% to $108.35 at press time.
Oil ETFs like the United States Oil Fund (NYSE: USO) also recorded declines, with USO falling 1.05% to $160.05 during pre-market trading on Monday. The ProShares Ultra Bloomberg Crude Oil (NYSE: UCO) also fell 0.49% to $63.28 during pre-market trading.
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