Page added on September 1, 2017
The U.S. Energy Department on Thursday released 1 million barrels of oil from the Strategic Petroleum Reserve and a White House adviser said more could flow after Tropical Storm Harvey inundated Gulf Coast refineries and drove up motor fuel prices.
In the first tapping of the reserve for an emergency since Hurricane Isaac in 2012, two emergency exchanges of oil of 500,000 barrels will be delivered to the Phillips 66 refinery in Lake Charles, Louisiana, the department said.
That plant has not been hit by Harvey, which hammered Houston and the Gulf Coast with catastrophic flooding and shut about a quarter of U.S. refinery capacity.
The release of 1 million barrels is small compared with U.S. demand of nearly 20 million barrels per day. The move did not halt rapidly rising gasoline prices, which surged more than 13 percent on Thursday to a two-year high above $2 a gallon ahead of the high-demand Labor Day holiday.
An adviser to President Donald Trump told a White House briefing that more oil could be sprung from the SPR.
“I think we would be very comfortable tapping into that and providing that alleviated resource,” homeland security adviser Tom Bossert told reporters.
Under the exchange, 400,000 barrels of sweet crude and 600,000 barrels of sour crude oil will be sent via pipeline from an SPR cavern in Louisiana to the refinery. The government will lend the crude to Phillips 66, which is required to replace the oil at a later date.
The SPR, established in the early 1970s after the Arab oil embargo caused widespread fuel supply panics, contains 679 million barrels of oil, enough to meet total U.S. needs for 33 days, in heavily guarded underground caverns on the Texas and Louisiana coasts.
U.S. gasoline prices surged anew after Colonial Pipeline Co , which operates the biggest U.S. fuel transport system, said it would shut its main lines to the Northeast amid outages at pumping points and lack of supply from refiners.
The Energy Department “provide assistance as deemed necessary, and will continue to review incoming requests for SPR crude oil,” spokeswoman Jess Szymanski said.
The department did not comment on whether it was asking the Paris-based International Energy Agency to plan a coordinated drawdown of crude from spare supplies. The IEA has said it does not see a need to act for the moment, as the global market is amply supplied.
Democratic Senator Edward Markey of Massachusetts urged the department this week also to release gasoline from the country’s emergency gasoline reserve, which holds a total of 1 million barrels of gasoline in three locations in the Northeast: New York Harbor, Boston and Maine. That reserve, which has never been used, was created after Superstorm Sandy wrecked fuel infrastructure in New York in 2012.
56 Comments on "US Releases 1 Million Barrels Of Oil From Strategic Reserve"
forbin on Fri, 1st Sep 2017 9:30 am
is that all?
gonna make a big difference or what ?
Forbin
Tom on Fri, 1st Sep 2017 10:23 am
Wait, Commercial Storage supposedly has over 400 Million BBLs in it. If this is accurate, then why pull from the SPR?
sidzepp on Fri, 1st Sep 2017 12:48 pm
Let me get this straight: “The government will lend the crude to Phillips 66, which is required to replace the oil at a later date.”
Sound a little like profiteering or even racketeering to me. They get to use free oil and use the profits from those sales to buy raw crude at that is now less per barrel than it was before Harvey hit. I imagine the government will be just as benevolent with the millions of people who lost everything.
Now I get it. Those millions don’t donate money at election time.
Apneaman on Fri, 1st Sep 2017 2:57 pm
China sees new world order with oil benchmark backed by gold
Yuan-denominated contract will let exporters circumvent US dollar
https://asia.nikkei.com/Markets/Commodities/China-sees-new-world-order-with-oil-benchmark-backed-by-gold
Anonymouse1 on Fri, 1st Sep 2017 4:00 pm
Good point sid, one has to ask, what all this ‘lending’ business is about. Why not just, you know, ‘sell’ a million barrels to the uS oil cartel and the gubmint can do w/e it wants later? If Exiconoco needs a million barrels, let them just buy it straight up, like everyone else. I thought the Jenwnited snakes was all about capitalism, buy high, sell low, every man for himself. But no money changing hands? That’s communism!
Where is narrativeman to complain about this blatant absence of pure oily capitalism when we need him?
rockman on Fri, 1st Sep 2017 5:07 pm
“…buy raw crude at that is now less per barrel than it was before Harvey hit.” What makes you think oil will be selling for less when it’s returned? Typically returns are made 6 to 12 months after it’s transferred. Always amazing to see criticism from folks that are completely ignorant about much if not all of the various dynamics.
As I often refer to them: armchair warriors. LOL.
Makati1 on Fri, 1st Sep 2017 5:12 pm
Ap, thanks for the ref. China is moving forward on their plans for the dollar and oil faster than I expected. If the us keeps bashing China and Russia, it may find out that its dollars are, well, just paper. Physical gold everyone understands and trusts.
Anonymouse1 on Fri, 1st Sep 2017 5:15 pm
And there he is, right on cue….
Makati1 on Fri, 1st Sep 2017 5:18 pm
Good morning to you too, Anon. ^_^
rockman on Fri, 1st Sep 2017 6:08 pm
Tom – “Commercial Storage supposedly has over 400 Million BBLs in it. If this is accurate, then why pull from the SPR?”. Same continuous confusion by this number being tossed out with an explanation of what it means. It is not hundreds of millions of bbls of oil sitting in tanks waiting for buyers. It is the “working volume”: oil that is in the process of moving from the well head to the distallation units in the refineries. I assume you don’t think oil comes out of the well head and immediately is turned into gasoline, do you?
Think about it: between domestic production and imports about 550 MILLION BBLS OIL enters and leaves the system every month in the US. So here’s the question: when the MSM says the oil “storage” increased 5 million bbls last week does that mean 5 million bbls went to a tank farm last week and is sitting there waiting for a buyer? Or does it mean an extra 5 million bbls of oil entered the transport system heading to a refinery? Do you know? Of course not. And guess what…neither does the Rockman. LOL. BTW: same question if the storage volumn decreased 5 million bbls last week.
Again think about it: every 3 weeks or less nearly every bbl oil “in storage” is replaced by a new bbl.
rockman on Fri, 1st Sep 2017 6:12 pm
Aman- “And there he is, right on cue….” Yep, it’s a never ending task. But there’s so much ignorance out there to correct. LOL.
Davy on Fri, 1st Sep 2017 6:40 pm
Thanks rock, what we need is answers like you gave instead of emotions like the ignorance you mentioned.
Anonymouse1 on Fri, 1st Sep 2017 6:53 pm
So, now that the uS has released this one million barrels from its persevere, free to roam in the wild, and do as it will, what do you think will happen next? Will it seek a mate? Try to find a herd of its own kind for mutual protection and companionship? This oil has been confined by, and cared for by humans since birth, and has no real survival skills or instincts of its own. It could be premature to release this oil into the wild w/o adequate preparation. It could wind up dying from exhaustion and starvation, or get hit by vehicles while the oil tries to cross a highway, or killed by predators, or trophy hunters. Who knows what could happen?
My own suspicion, is what the oil will do, is, once its released, it will try to return to its natural habitat, which according to our self-accredited ‘expert-on-all-things-cancer’ aka rockerman anyhow, is this place here:
https://en.wikipedia.org/wiki/Gulf_of_Mexico
I further suggest the uS authorities place GPS tracking collars on the million barrels, so that scientists can study what the oil does, and where it goes once released.
Davy on Fri, 1st Sep 2017 6:56 pm
“Venezuela Headed For “Messiest Debt-Restructuring In History” Thanks To US Sanctions”
http://tinyurl.com/ycs2rx64
“After being effectively shut out from global financial markets – a situation that was made more precarious by US sanctions prohibiting purchases of Venezuelan debt (unless you’re buying them off Goldman Sachs, should the bank’s asset-management arm desire to liquidate its $3 billion “hunger bond” position) – Venezuela is drawing ever-nearer to what the Financial Times describes as potentially the “messiest debt restructuring in history.” So far, Venezuela has managed to forestall a default by stripping assets from its state-owned oil company, Petroleos de Venezuela, commonly referred to as PVDSA, and shaking down local institutions of spare dollars – not to mention the explicit financial support of China and Russia. Recently, Rosneft, the largest Russian oil company, helped support its troubled ally, which enjoys the largest crude reserves in the world, by offering billions of dollars in advance payments for future crude supplies. Thanks to a deal brokered by deceased former President Hugo Chavez, Venezuela has for years been Rosneft’s largest foreign supplier of crude. Last year, the oil giant accepted a 49.9% stake in PVDSA’s US-based subsidiary, Citgo, as collateral for a $1.5 billion loan.”
“However, thanks to the US sanctions, which prohibit purchases of newly issued debt and existing bonds that have so far not been sold outside of Caracas, the country will once again need to innovate or risk sliding into bankruptcy. Making matters all the more urgent, the country recently suffered a loss in US courts after a judge ruled that Canadian miner Crystallex can seize Venezuelan money held in a custody account at Bank of New York Mellon to cover a $1.4 billion judgment awarded by a World Bank tribunal. Crystallex’s victory could further embolden the country’s creditors, who collectively may be owed as much as $3.7 billion. “Venezuela has been taken to the World Bank’s ICSID tribunal 43 times. Only Argentina has been subjected to more claims. Of these 24 are still pending, including claims from Anglo American, ConocoPhillips, Air Canada and Vestey. The Eurasia Group estimates that Venezuela owes a total of $3.7bn as a result of ICSID rulings, and Crystallex’s progress is likely to embolden other creditors.”
Go Speed Racer on Fri, 1st Sep 2017 8:22 pm
Gee Rockman, I thought there
Is 4 kinds of wells you guys drill.
There is
Gasoline
Diesel
Natural gas
Propane
There aren’t any coal wells because
coal comes from Open pit.
Go Speed Racer on Fri, 1st Sep 2017 8:24 pm
Hurricane Harvey has hit the nation
with flooding. At times like this,
every American must do their part.
If every American gave $50 to me at this
Time of national crisis, it would make the
difference.
Do your part, if you don’t have $50 then
donate $20 to me and multiplied by all
the other people doing the same,
it will make the difference at this crucial
time of national calamity.
Tom on Fri, 1st Sep 2017 8:29 pm
Rockman; As I understand it, Commercial Storage Volume (as reported by the EIA) is the amount of crude oil in storage that is not part of the SPR… Mostly in the Huge Stock Tank farms sitting adjacent to large refineries & Cushing, etc…
Keith McClary on Fri, 1st Sep 2017 8:30 pm
If most of the refineries are down, how does supplying more crude help?
Tom on Fri, 1st Sep 2017 8:40 pm
I think Commercial Storage can be easily explained by simple volumes accounting. How much oil is in storage @ a given time.
You might be overthinking this a bit.
See Grenscapes’ method for estimating commercial storage volumes.
Tom on Fri, 1st Sep 2017 8:41 pm
If most of the refineries are down, how does supplying more crude help?
Especially when the EIA claims that these refinery storage tanks are already full… See PADD 3 Commercial Storage Volumes…
bobinget on Fri, 1st Sep 2017 9:23 pm
BREAKING:
China challenges petrodollar directly.
I predicted this when Russia and China swallowed
Venezuela whole.
https://asia.nikkei.com/Markets/Commodities/China-sees-new-world-order-with-oil-benchmark-backed-by-gold
bobinget on Fri, 1st Sep 2017 9:27 pm
Tom, Keith, its all about location, location.
Many pipelines are inoperative.
In actual numbers of course you all are absolutely
correct.
Inland of course, most refineries are operating as normal.
GregT on Fri, 1st Sep 2017 10:08 pm
BREAKING:
China challenges petrodollar directly.
I predicted this when Russia and China swallowed
Venezuela whole.
A prediction that my colleagues and myself have made for several years now.
What to do? Asassinating Jinping isn’t an option, and neither is bombing China back into the Stone Age. Things are about to get far more interesting on the world stage. Buckle up everyone.
rockman on Fri, 1st Sep 2017 10:43 pm
Anom – Will the 1 mm bbls coming out of the SPR this next month matter? I agree: compared to the 550 mm bbls being run thru the refineries in the next month…not much.
Tom – I’m not overthinking the situation. You need to think a bit harder and look up the definition of “commercial storage”. A hint: it includes all the oil moving from domestic wells and all the imported oil being offloaded from those ships.
Now here’s the tough research: find a reference source that shows how much oil is in LONG TERM storage in the US.
Boat on Fri, 1st Sep 2017 10:53 pm
With China 27 trillion in debt and all the gold in the world worth 1.7 trillion China should be the worlds gold standard. lol Borrow a few more trillion to buy gold to trade oil? greggiet may buy this bullshyt conspiracy but then again he’s buckled up for the big ride that never materializes.
rockman on Fri, 1st Sep 2017 11:03 pm
Racer – Honest to Dog: true story I’ve told before. Back in the 70’s during the “Arab embargo” eating lunch in a bar across the street from Mobil Oil some old fart nursing a beer was going on and on about the “f*cking oil companies” raising prices. My coworker, “Mad Dog” Mandle (a Nam vet with a short fuse) was about to tear into him when the old fart defused the tension: said “We don’t need any more f*cking oil wells…we need more gasoline wells”.
Years ago I did show & tells at public schools showing the natural element and rocks used to make many common household items. Not a shock that most 10 year olds had no clue. But disappointing how many teachers also didn’t.
Makati1 on Fri, 1st Sep 2017 11:13 pm
Boat, the US is $20+ Trillion in debt and counting, plus another few hundred trillion if you count State, corporate and personal debt. No so the Chinese. And they have many tons of real gold to back up their money. The US has nothing but bad promises and an eroding infrastructure.
Boat on Fri, 1st Sep 2017 11:40 pm
mak,
And the P’s have plastic in their waters. A growing infrastructure.
GregT on Sat, 2nd Sep 2017 12:12 am
Boat,
And 3 out of the top ten manufacturers of plastics in the world, have manufacturing facilities in Texas. There are plastics in every body of water globally, and that accumulation of plastic continues to grow, exponentially. Just like your exponentially growing level of stupidity.
GregT on Sat, 2nd Sep 2017 12:25 am
“greggiet may buy this bullshyt conspiracy but then again he’s buckled up for the big ride that never materializes.”
greggiet is thouroghly enjoying his new life outside of an unflooded city, and bought the majority of his gold when it was well below $800 US per ounce. He sold a great deal of that gold at $1800 per ounce, and retired at 52 years of age. The rest of the gold that greggiet still holds, didn’t cost him a penny.
greggiet doesn’t need to buckle up, he has no debt, and no need to work anymore. greggiet is doing just fine. greggiet is enjoying the ride, immensely. Life is good.
GregT on Sat, 2nd Sep 2017 12:31 am
Life is good, for greggiet. I might also add Boat, greggiet did even better on silver.
Makati1 on Sat, 2nd Sep 2017 12:51 am
“And the P’s have plastic in their waters. A growing infrastructure.”
What is that mess of words supposed to say Boat? Nothing there makes any sense.
“Plastic in their water?” Explain please, if you can.
“A growing infrastructure.” Again, please explain.
Yes, the Ps is a fast growing country and much of it is new infrastructure. Dams, power plants ,railroads, roads, bridges, etc. A 6%+ growing GDP. Just the opposite of America.
Maybe you need to have your meds checked?
Cloggie on Sat, 2nd Sep 2017 1:18 am
greggiet doesn’t need to buckle up, he has no debt, and no need to work anymore. greggiet is doing just fine. greggiet is enjoying the ride, immensely. Life is good.
I’m happy for you Greg. And I’m sure that everyday you sink on your knees and with tears in your eyes you thank technology and industrial civilization in general that enabled your good fortunes.
Cloggie on Sat, 2nd Sep 2017 1:19 am
Yes, the Ps is a fast growing country and much of it is new infrastructure. Dams, power plants ,railroads, roads, bridges, etc. A 6%+ growing GDP. Just the opposite of America.
Babies are known to grow faster than adults.
Makati1 on Sat, 2nd Sep 2017 2:23 am
Cloggie, you are as narrow minded as some others here. The doctor that just put a stent in my sister’s heart is Chinese. The nurses that took care of my mother when she was in the hospital were Filipino. My Dentist is Filipino and better than any of the dentists I had in the US over my lifetime. There are Filipino engineers, architects, etc, working here and all over the world. Do you think the 60 story towers here are designed and built by some European or American staff? Nope. Filipinos. You have a very outdated and uninformed picture of Asia.
http://www.makatimed.net.ph/
http://www.makatimed.net.ph/services
You might want to check out this site. LOL
Cloggie on Sat, 2nd Sep 2017 4:28 am
Narrow-minded? Perhaps, but also more realistic than you.
https://en.wikipedia.org/wiki/Philippines
GDP nominal per capita $3280
I immediately believe that you have good doctors and dentists with your imperial $s.
But the Ps are much bigger than your makati international business quarter. Outside your business square mile the slums begin.
As I said, babies like the Ps grow faster than the developed world.
Makati1 on Sat, 2nd Sep 2017 5:03 am
Cloggie, you have ZERO knowledge of what it is really like here. ZERO. WIKI is not a source of current conditions. Nor are most US info sources.
Philippine PPP currently is about $8,000. or ~$32,000 for a family of 4. That is above the US poverty line. You cannot compare apples and carrots. The last tooth crown I had installed in the US 10 years ago cost me $1,250. The one I just had it replaced with, two years ago, cost me $120. The last US haircut cost me $12. The one I got yesterday here cost $2. And, in both cases the one I got here was better.
Our farm caretaker supports his family of five on about $4,000 per year. His daughter is graduating from college next year with a bachelor’s degree in business and his son is going to college the year after to study engineering. They also have a retarded son, aged 12, whom they take care of. And they are a happy, close family.
You can live quite well on less here as there is no need to heat your home and no need for electric or even gasoline if you live in the country. There is basic medical support from the government and school and college is practically free. It costs about $300 per year for fees, books and transportation. Total. Nor do most Filipinos have to pay any tax except VAT on the things they buy. A whole different culture. And a better one.
https://data.worldbank.org/indicator/NY.GDP.PCAP.PP.CD?name_desc=true
It is the Western waste and regs that cost so much. The need for a car, a house full of techie junk and ‘trying to keep up with the neighbors’ attitude. Many families in the US are living on even less than Filipinos. Take away the US government dole (unemployment insurance, welfare, food stamps, etc.) and you would see the 3rd world America out in the open. Ditto for Europe.
Anonymouse1 on Sat, 2nd Sep 2017 5:24 am
Mak, cloggen-fraud has openly admitted he seldom, if ever reads his own links (sources). He ‘skims’ his purported sources and often times, doubtful he even bothers to do that little. This is why he carelessly posts links that often flat out contradict the point he is, supposedly trying to make, imagine that.
He’s called cloggen-fraud for good reason…
Makati1 on Sat, 2nd Sep 2017 5:34 am
Anon, I seldom read all of the comments here. I pop in and out of PO when ever I need a break from something else. I read the new articles that interest me and check the comments log at the bottom right to see who is saying what. I probably miss anything that is not there or happens when I am asleep. I certainly do not read all of Cloggie, Davy or Boat’s blather. I do read all of yours that I see along with a few others here. Open minds are rare in these times.
Davy on Sat, 2nd Sep 2017 6:28 am
“I pop in and out of PO when ever I need a break from something else.”
How funny is that? Makat, you are constantly here. You are here more than anyone else except maybe clog. You are the primary reason this board is all about hate and discontent. I see above we have multiple lines on how wonderful the Philippines is. How many times do you need to tell us all the details of your stupid little overpopulated Island? The place is an ecological nightmare in the crosshairs of the wort of climate change. Your Houston is coming and it will be ugly because you have 20MIL urban sprawl instead of 8MIL. No wonder we rarely have fresh insight. It is the same old pissed off ass wipes blathering the same shit. I am part of it too. I try to report on the issues but the board agendist insist on making this board an effort at polarization.
Davy on Sat, 2nd Sep 2017 6:37 am
anyMouse is our board Canadian millennial boy wonder. Mouse, Clog can write in proper English with proper sentences. He doesn’t use Xbox live language. He is not a budding terrorist that one day will start a secrete cell to attack Americans. I may not always agree with him but he is real and you are a fake. You are an example of why Canada is going down the drain as swiftly as the US. The difference is Americans on this board talk about how we are going down the drain. All you whine about is how Americans are going down the drain and all the wrongs Americans have done to you Canadians.
Davy on Sat, 2nd Sep 2017 6:41 am
“greggiet doesn’t need to buckle up, he has no debt, and no need to work anymore. greggiet is doing just fine. greggiet is enjoying the ride, immensely. Life is good.”
Ha ha ha ha, when people talk like that it usually means something is deeply wrong in their life or they are so fat and happy their life is going to drop out from under them like a blind punch in the face. Grehg, we are all facing a very dangerous future and yes, even you up in your little Salmon Arm enclave will face dangers. Braggarts make me ill.
Davy on Sat, 2nd Sep 2017 6:41 am
oh, and good morning to the rest of you normal people.
GregT on Sat, 2nd Sep 2017 9:25 am
Cloogie,
“I’m happy for you Greg. And I’m sure that everyday you sink on your knees and with tears in your eyes you thank technology and industrial civilization in general that enabled your good fortunes.”
I’m sure that every single human being in the past 200,000 years, born before say 1750, missed technology and industrial ‘civilization’, and lived absolutely miserable lives. I’m also sure that they needed to work outside of the home their entire lives to pay off debt to somebody that they had never met, who created that debt out of thin air.
No Cloggie, if I could have lived in a cabin in the woods, off of the land, without automobiles, televisions, computers, and central bankers’ nooses around my neck, I would have been content a very long time ago. All of the stuff in the world does not make a person happy. Happiness is a state of mind, and satisfaction comes from hard work and doing things for yourself, not from the shelves of the local big box store. Those are temporary dopamine hits that quickly wear off, that leave a person wanting for more, while never really understanding why.
GregT on Sat, 2nd Sep 2017 9:41 am
Davy,
“Ha ha ha ha, when people talk like that it usually means something is deeply wrong in their life or they are so fat and happy their life is going to drop out from under them like a blind punch in the face. Grehg, we are all facing a very dangerous future and yes, even you up in your little Salmon Arm enclave will face dangers.”
Other than the dangerous future that we likely all face, and all of our eventual deaths, everything else in your above comment could not be more wrong. If it somehow makes you feel better about yourself, to continue to make shit up in your delusional little mind, knock yourself out. It’s actually quite funny, in a sad kind of way.
Davy on Sat, 2nd Sep 2017 9:59 am
Good morning to you too grehg. I feel the same about you. If that somehow makes you feel better about yourself, to continue to belittle others, knock yourself out. I will make sure you pay a price for that despicable behavior. I promise you that like I promised makat. You have such a high regards for yourself and all. No wonder you and makat are so close. Two braggarts enamored with themselves.
onlooker on Sat, 2nd Sep 2017 10:10 am
Absolutely. I am another person of I think many nowadays quite dissilusioned by modern life. What I believe is fulfilling is being truly free and learning and attaining your goals by your own efforts. We are in many ways a sad species, our entire history we have groped for what would fulfill us and have been led by our primitive urges to ephemeral pleasures but in a profound manner restless and not at ease. I truly believe one can say we individually and collectively have not identified Peace of mind as a worthy state of mind to bring fulfillment, too much craving and not at Peace, or so I believe.
GregT on Sat, 2nd Sep 2017 10:28 am
More of your delusions Davy.
Your issues are blatantly obvious, and your condition has been in a state of deterioration for at least three years now. Exactly like I predicted that it would. As transparent as glass.
You are not making anybody pay anything, except again, in your own mind.
What despicable behaviour would that be Davy. Please do tell.
If you honestly believe that I hold myself in such high regard, then thank-you. I will take that as a compliment. I must be doing something right.
I have never met makati, but will take him on his word that he lives half way around the world from me. Not exactly close.
It is your own insecurities, that make you feel like others are braggarts. If not for those insecurities, you wouldn’t care. Basic human psychology.
Davy on Sat, 2nd Sep 2017 11:08 am
grehg, your words are empty and fake. Maybe, you will reconsider pricking me in the future. I can play your game too. JuanP and Apnea don’t prick me and I don’t prick them. That is an example of past conflicts that ended. There is no cycle of intellectual violence. They make their message and I make mine. My business with makat is my business. If you chose to make that business yours then your business is my business. I have a backbone to stand up to your self righteous pricking. You are also fun to prick back because you are such a braggart. Your unbalanced agenda of anti-Americanism is easy to pop. That’s the options o great one from dumbass.
GregT on Sat, 2nd Sep 2017 11:28 am
Davy,
I have made my position to you crystal clear. I am not Anti-American. That would be your own insecurities, emotional instability, and identity issues, superceding rational thought.
All,of the problems that you have with others here, stem from those same three underlying psychological issues. The childish rhetoric, name calling, and lashing out, are all indicative of a damaged ego. If you ever decide that you would prefer to feel better about yourself, then get some help. Nobody else can do that for you, and the longer that you continue doing what you are, the further your condition will continue to deteriorate.