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COMING UP:Share Opener Variant 2

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Transcript

00:00:02
>> President Trump's proposed 2018 budget is stirring typical partisan controversy in Washington. But buried in its pages are some ideas that may up end plans of energy players, from OPEC to Texas. The first signs came early Tuesday, as the plan was set to be delivered, when oil prices plunged almost 1% on one White House proposal to sell off half of America's strategic oil reserve.
00:00:28
Investors recouped their losses later in the day, but that may not be the end of the upheaval. Reuters' Energy Editor David Gaffen explains why the market selloff stopped for now.>> It still has to go through Congress, obviously. Budget proposals are big, long range, winding documents that have a lot of different moving parts.
00:00:47
And there will probably some people in Congress who have some objections to it. So it will take time before we even get to the point whether we know this is going to happen or not, whether it will be reduced in size or even scuttled all together.>> By selling off half of the nation's 688 million barrel oil stockpile over a period of 9 years, the White House aims to raise $16.5 billion to help balance the federal budget.
00:01:14
Other administrations have proposed similar ideas, but failed to get them through Congress. It is, however, also a powerful message to OPEC about the United States decreasing need for imports as its own production reaches new highs. But Gaffen says this could hurt shale producers at home.>> If we flood the market with more oil, we put ourselves in position where there would be too much, prices drop and then these shale companies that react to prices very quickly would be inclined to produce less.
00:01:45
And if that happens the administration will have inadvertently undermined the efforts that they are promoting themselves, in having the United States produce more of its own specific energy.>> The plan comes as OPEC members meet this week in hopes of extending production cuts by nine months to help boost oil prices.