Oil prices fell on Tuesday after U.S. President Donald Trump proposed the sale of half the country’s strategic oil reserves.
The move comes just days before OPEC us due to meet over a possible extension of output cuts aimed at reducing a global oversupply.
Brent crude futures were trading down 56 cents, or 1.04 percent, at $53.31 per barrel at 10:15am GMT.
US West Texas Intermediate (WTI) futures were at $50.67, down 46 cents, or 0.9 percent.
The White House budget plan would sell off half of the nation’s emergency oil stockpile from 2018 to 2027.
This could raise $16.5 billion from October 2018, documents released on Monday showed. It also suggested opening up more production in Alaska.
The budget, which will be delivered to Congress today, is meant as a proposal and may not take effect in its current form.
But it reveals the administration’s policy hopes, which include ramping up American energy output.
The plan was released just a day after Trump left OPEC’s de-facto leader Saudi Arabia following his first overseas state-visit.
A release of U.S. strategic reserves would jolt oil markets, where the Organization of the Petroleum Exporting Countries (OPEC) and other producers, including Russia, have pledged to cut output by 1.8 million barrels per day (bpd) in order to tighten the market.
OPEC, led by Saudi Arabia, and other participating producers will meet on May 25 and are expected to extend the period of the cut from just the first half of this year to all of 2017 and the first quarter of 2018.