Did Biden Sell US Oil Reserves to China?

Last week, Reuters reported that the Biden administration released oil from the US strategic oil reserves to foreign countries including China. The news media on both sides is so biased that it is hard to understand what really happened. I am going to take a closer look at the facts in this video.

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Reuters article (Jul 5) https://www.reuters.com/business/energy/oil-us-reserves-head-overseas-gasoline-prices-stay-high-2022-07-05/

Mark Cuban comments on China. https://thetexan.news/dallas-mavericks-owner-mark-cuban-defends-nbas-business-with-china/

Ray Dalio comments on China https://www.businessinsider.com/ray-dalio-defend-china-peng-shuai-cnbc-bridgewater-sorkin-disappear-2021-12

Obama admits mistake in Libya What Obama Says Is His ‘Worst Mistake’ As President

Presidential Debate Trump on China and Biden on Ukraine at 3rd Debate | NBC10 Philadelphia

Jared Kushner Saudi investment https://www.rollingstone.com/politics/politics-news/jared-kushner-saudi-arabia-investment-mohammad-bin-salman-1335649/

Fact check https://www.politifact.com/article/2022/jul/11/why-us-selling-stockpiled-oil-china-we-have-answer/

US Oil Release – Biden says unprecedented use of oil stockpile will ease US fuel costs ‘pain’ (msn.com)

Three historic drawdowns of US oil reserves https://www.energy.gov/fecm/strategic-petroleum-reserve-0

China increasing their reserves https://freebeacon.com/national-security/how-biden-helped-a-chinese-gas-giant-boost-the-communist-nations-oil-reserves/

EXCLUSIVE China boosts oil reserves, ignoring U.S. push for global release | Reuters

Putin China meeting https://www.youtube.com/watch?v=K8LcM3aip7Y

Locations US Oil Reserves


Tucker Carlson synopsis


Video Summary:

Let me start with a disclaimer. I will be making some criticism of China in this video. I am referring specifically to the government of China, the Communist Party of China, or the CCP. I have nothing but respect and love for the Chinese people. Please do not send any hate towards the Asian community. The point is to highlight the real issue in this story, which is the Communist Party of China.

The reason this news story has hit a nerve with the American people, is there has been a longstanding criticism of Biden that he is weak on China because of his past business relationships through his son, Hunter Biden. Here is a clip from the debate during the last election.

Now if you don’t like Trump, don’t worry, because I am going to criticize him in a little bit. But I want to focus first on the issue of China. The criticism is that Biden gets a lot of money from China, and so he is going to make policy decisions that are favorable to China at the expense of the American people. I think you have to look at this in the broader context. Biden is not the only person getting rich from China. A lot of very wealthy people act the same way. These are people like Mark Cuban and Ray Dalio. I am going to take some time and show you what these people are saying about China.

Here is Mark Cuban on Megan Kelly’s podcast talking about why the NBA continues to invest in China, despite their human rights abuses. This is in contrast to the Women’s Tennis Association which pulled events out of China, when tennis star Peng Shuai went missing.

Here is Ray Dalio on CNBC talking about why he continues to invest in China, despite their human rights abuses.

These are billionaires that publicly stick up for China. They are getting rich at the expense of the American people. Meanwhile the Chinese people are struggling with human rights abuses from their own government. So what Biden is being accused of here, is just doing the same thing that all his billionaire friends are doing. They want Biden to act this way. They are being friendly to China, while looking the other way on all the bad things that are happening. Meanwhile, China is very public that they are not a friend of the United States. In fact, they are a very serious military and nuclear threat.

So how did the US send China the US oil reserves? Let us look at the timeline. We all know that we have been suffering through high inflation and high gas prices. The Biden administration called on nations around the world to cooperate in cooling the oil markets. China did the opposite. In February, China ramped up purchases in its oil reserves, pulling oil off the market and causing prices to rise even higher. China started doing this immediately after Vladimir Putin’s visit to Beijing at the start of the Olympics. Take a look.

The timing of China’s actions has caused speculation that it is part of a coordinated effort between Russia and China to cripple the United States. Gas prices continued to rise. The next month, on March 31, Biden announced he was going to perform the largest release from the US strategic oil reserves ever to counter rising gas prices. On April 21, part of that release totaling 950,000 barrels was sold to Unipec, which is a company owned by the Chinese government. So, the US oil reserves have gone down and China’s oil reserves have gone up in the middle of an energy crisis. Reuters broke this news story last week on July 6. Here we are, 11 days later, and the Biden administration has refused to make any statement about the sale.

It is important to understand a little about the US strategic oil reserve. The US has four large, empty salt caves located in Texas and Louisiana. We use these caves like large bottles, that we fill up with oil. If the US ever needs the oil, they can easily pump it out of the salt caves. The US started doing this in the 70s because of OAPEC. Saudi Arabia and other Middle East countries who are a part of OAPEC control a large amount of the world’s oil supply. At the time, OAPEC announced an oil embargo where they refused to sell oil to countries that supported Israel. The price of oil rose 300% and shocked the US economy. The US strategic oil reserve started as a response to that threat. If a foreign nation tried to interrupt oil supplies, the US would be able to release oil into the markets to relieve the price shocks.

Whenever the US releases oil from the US strategic oil reserve, it is a big deal. It does not happen very often. In fact, it has only happened three times before now.

  1. In 1991 for Operation Desert Storm
  2. In 2005 for Hurricane Katrina
  3. In 2011 for the Civil War in Libya

What happened in Libya is the closest precedent to what is happening now. In case you forgot, Libya broke out into Civil War in 2011 when rebel forces ousted Muammar Gaddafi. Gaddafi was captured and killed but the fighting continued into 2012 when US government buildings were attacked in Benghazi. Multiple Americans including the United States Ambassador, Christopher Stevens were killed. Obama considered the aftermath of the civil war in Libya as his greatest mistake as President.

Hillary Clinton was the Secretary of State at the time, and responsible for overseeing the situation in Libya. Her mismanagement became a major talking point of the 2016 US presidential election when she lost to Trump.

What a lot of people do not realize, is the reason Libya was important was because of oil. Libya is a member of OAPEC and was the 16th largest oil producer in the world in 2021. So, for Libya to fall into Civil War and stop producing oil, was a major shock to the oil market. The Obama administration released oil from the US strategic oil reserves to help fight the increase in gas prices.

This is somewhat similar to the situation today. The war between Russia and Ukraine has disrupted oil supply chains around the world. The strategic oil reserves were used under Obama’s administration, and so Biden wants to do the same thing that Obama did. Now there is an argument that this is not a proper use of the US Strategic Oil Reserves. There are other alternatives that would also reduce the price of oil including lowering red tape on setting up new refineries, allowing more drilling on US soil, or completing the Keystone XL pipeline. Draining the US strategic oil reserves was not the only option, but it was the one Biden decided to use. The Biden administration claims they are doing everything they can to reduce oil prices, but that is not true. If you talk to any oil executive, they will disagree with that.

So at this point, we have had two subsequent Democrat administrations who have drained US strategic oil reserves in response to global events. This is a difference in philosophy between Democrats and Republicans. Democrats believe in reducing America’s reliance on fossil fuels. Their solution to high gas prices is to get rid of the US strategic oil reserves. Republicans’ philosophy on reducing gas prices is to make America energy independent by tapping into the oil sources that are on US soil. Then it would not be necessary to release oil reserves. You can agree or disagree with either of these approaches, but under any philosophy, what happened at the auction with China was wrong.

This brings us to the auction. The US sold the oil from the US Strategic Oil Reserve to the highest bidder. One of those bidders was the government of China. China walked away with almost 1 million barrels of oil.

Some liberal news sources, including so-called “fact check” websites, are already creating excuses for the Biden administration. They claim the US had to sell oil to China. The US is required by law to sell to the highest bidder, and if our adversary is the highest bidder, we have to give them our oil. There is nothing we can do.

Here is what the law says: 42 US Code 6241 (e)(1) “The Secretary shall sell petroleum products withdrawn from the Strategic Petroleum Reserve at public sale to the highest qualified bidder…”

So, the argument for the Biden administration is they were blindly following normal procedures, and they had to do it this way. I am here to tell you, do not fall for this argument, because it is false.

By law the US only has to sell to “qualified” bidders. Not just anyone can walk off the street and bid. The Department of Energy has a list that you have to be preapproved for to be able to bid. On top of that, if the results of the auction are somehow giving bizarre results, or are not going to accomplish the goals of the release, they can just stop the auction. For instance, if US enemies are buying all the oil, the US could say, “that is not supposed to happen.” They can stop the auction at any time. They are not forced to give our oil to China.

This is an important point. There was an intentional decision here. I want you to imagine this. The staff from the Department of Energy were sitting around a conference table. And they were reviewing the list of winning bids from the auction. These people are all experts in the oil industry. They know everything I have talked about in this video. They know about oil markets. They know this is an important situation that does not happen very often. They know that China has been increasing their oil reserves. They know the company Unipec is owned by the Chinese government. They know that China is our adversary. They knew that giving this oil to China, was not going to accomplish the goal of the release, which was to reduce gas prices. So why would they go through with the auction? They went through with it knowing it was wrong. What they should have done was to stop the auction, take the Chinese government off the list of bidders, and run the auction again.

I will tell you why they did it. They sold the oil to China, because there is a policy in the Biden administration on being soft on China, and the American people are getting hurt. Why won’t Biden explain what happened? Why is the mainstream media letting him get away with this?

Now let us talk about Trump. The liberal media counters any criticism of Biden by bringing up the argument that Trump did the same thing. Let us look at what Trump did. After Trump left office, his son-in-law, Jared Kushner, received $2 billion into his private equity firm from Saudi Arabia. The money was personally approved by the controversial Saudi Crown prince Mohammed bin Salman. Mohammed bin Salman has a long list of human rights violations including being accused of the assassination of Washington Post columnist Jamal Khashoggi. So, the accusation against Trump is that he also is compromised by foreign governments. Jared Kushner was a Senior Policy advisor to the President and played a crucial role in talks during the Middle East Peace Process. For him to receive investment in his business only six months after working in the White House, suggests the money could have been a bribe after-the-fact for decisions he made to influence US policy. Typically, you would want former White House staff to wait a longer time, for instance a two-year period, before taking money from foreign governments. This is very concerning. If Trump ever returns to public office, Jared Kushner should not be allowed to work in the White House.

However, we must be honest that these two situations are not the same. Kushner taking money six months after Trump leaves office is not the same as Biden making China friendly decisions while he is in office. In addition, Trump’s peace plan for Israel was not favorable to Saudi Arabia. I see no evidence of bribery or collusion with Saudi Arabia. Now I am not here to promote Trump. I just feel that this oil deal with China is so important, that we need to be clear about the facts. And I will tell you guys right now, I will continue to watch out in case Trump tries to get away with anything. Saudi Arabia is not our best friend either. If Trump ever holds public office again, everyone will be watching like a hawk to make sure he does not give any breaks to Saudi Arabia. Let us do the same thing with Biden and China.

In summary, I am going to make this very simple. If you are suffering in America today, it is because we are a global economy, and you are competing against forced labor in China. If your wages are too low, it is because China can pay their workforce practically nothing, and they have no rights. If you complain against the Chinese government, you get disappeared. That is who you are competing against. Rather than help the American people, politicians are doing nothing. Nothing is being done, because there is a lot of wealthy people in the US who are getting paid by the Chinese government, and they do not want to speak out.

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Neither Zach De Gregorio or Wolves and Finance shall be liable for any damages related to information in this video. It is recommended you contact a CPA in your area for business advice.