>> the markets expected that powell would be reappointed, he would have brainerd as vice chair. >> there's no difference between the two of them. >> this is a no-brainer move. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. tom: good morning, everyone. on radio, on television, a simulcast. we dive into an interesting hour and a day where we consider oil in america. lots going on. we will get to all of that. anastasia amoroso with us any minute. but salt caverns in the bayou, and maybe we will release the oil, maybe not. is it really going to move the needle on a barrel of oil? lisa: if the u.s. does alone, not. but if the u.s. does it with

other nations, perhaps. the difference is that opec-plus think they are going to counteract that by possibly reducing production. this is setting up quite an interesting dynamic. tom: the president to tap the strategic petroleum reserve with other nations. that is a key item here. it's got to be coordinated to have any price function. kailey: the question really is what is the sum total of the coordinated move going to be. india is only looking at 5 million barrels. just think about the additions opec+ has put in over the last month. is 4000, 5000 barrels a day. the question will be what is the size. it is going to be in parallel with china, india, japan, and u.k., confirming what we already had been signaled. you have five nations doing this together. how much is that actually going to be? tom: do we see a moving oil?

i can't tell. we are down a dollar on west texas intermediate. lisa: you saw a little move lower. we are near the lows of the day, down about 1.25%. a lot of it probably was frontloaded, and we are waiting for a bunch of the details, but still notable to see how much oil has come down. we were talking about $100 a barrel by the end of the year. we are not talking about $75 on the nymex. tom: to go down to $75.66, brent crude from $84 down to $79.05, but i would say is back to the 1970's and the time of a first oil shock, and then critically, a second oil shock, my recollection in my youth is it was the second oil shock that changed this nation. the strategic petroleum reserve was about units. it was about a supply shock

having nothing to do with the management of price. in your readings, you see any evidence you can manage price off of this discussion? lisa: that seems to be unclear. just give you a little more sense of what we are getting from the white house, the president is announcing they are going to release 50 million barrels of oil from strategic petroleum reserves to lower prices for americans, so we are getting a sense of the scope of it. in terms of what the reaction has been, it has been muted. a lot of it depends on what we see from other nations here. tom:tom: very quickly before get to the data, this is 50 divided by 600, is my immediate mass. i think that is like an 8% so what release, right? if the say so what announcement? kailey: it may be. it may be an announcement for the sake of making an announcement. how is this actually going to

drain into the prices consumers are paying at the pump? lisa: an oil analyst noting that crude oil is down about seven dollars a barrel since the discussion of a possible petroleum release from this reserve. that is not -- that is a pretty small move until now. tom: the president announces an available release of 50 million barrels of oil. red and green on the screen in the equity market, and looking at yield, 0.63%. yields are in just a little bit. i don't want to ascribe that to this announcement. the 10 year yield, 1.6 4%. i would note persistent dollar strength today, and turkish lira moving up to new weakness in the last two minutes, 12.6. briefed on the strategic petroleum reserve is annmarie

hordern, and she joins us right now. widely expected. are you surprised that it is 50 million barrels and not more? annmarie: my reporting yesterday was that it was going to be north of 35 million barrels, so i am quite surprised that it is 50 million barrels. i believe this is the biggest ever. 2011, when president obama tapped it when discussions -- when disruptions in libya was happening, that was 30 million. president bush, that was to the tune of 15 million. 50 million is a lot. they were able to get other consumers on board. i think the other countries are going to be a little bit more modest when you look at 50 million barrels coming from washington, but it sends to opec+ and the gulf. lisa: we are cnw ti come down to new intraday lows, now down 1.8%. i think it is notable to see that as people parse through the details of the scope of how much

the u.s. plans to release. really interesting to see the u.s. response to this. are we expecting a commensurate release from the other nations? do we have a sense of what those conversations of been like over the past few weeks? annmarie: reporting overnight from indian officials is that they will be out with a few million barrels, as well as japan will likely follow suit. china, little bit of an interesting point. they already announced following that meeting with president biden and xi jinping that they were looking into tapping their reserves. they had done so in september. they have been dealing with a volatile energy situation in china, so they are not likely coordinating on the same exact day, but you can see where the trend is going with these consumers who are dealing with higher prices. tom: is there a bipartisan

effort? is there a republican response to the democratic release? what is the debate here? annmarie: lawmakers sent a letter to the white house yesterday, republican lawmakers, led by rep resented of stephanie bice, as well as representative cheney and a number of others, saying why are we tapping the strategic petroleum reserve when we should be incentivizing our fossil fuel companies in america to produce more. of course, this is going to be a political debate. we have seen the gulf of mexico, the latest new releases, one of the biggest in terms of drilling releases we have seen. so you are seeing a bit of a political debate in congress. you also have many on the left saying we should do an export ban instead of tapping the spr. with prices lower, a lot of this was baked in. i was even shocked at how much the u.s. was able to talk down prices. but 50 million and prices moving

lower shows that they need -- they mean business, and it is even more than the market was. kailey: you have the price of a barrel of oil futures moving lower, but the average cost of a gallon of gasoline in the u.s. has held steady across the country. when you go further into the white house press release, they talk about anticompetitive practices potentially in the energy sector, and maybe that they are coalescing to give american consumers from benefiting when oil prices fall. talk about that dynamic little bit. annmarie: they sent a letter to the ftc about price gouging. we have seen administration after administration do this. it rarely wields any results. this is about long-term, looking for the data for how this happens. but the admin estrogen is looking into that. it is not going to be immediate. you're not going to immediately hit the price of dub edi and brent and it falls to the gasoline prices, but this will start to temper the prices at the pump.

i think we are just a little bit under aaa's $3.50 for a gallon of gasoline. that will likely start to temper. also, this is the biggest driving season. we have thanksgiving, christmas coming up. this is when americans are out in their cars, using more and more energy, and wind the administration -- and when the a adminstration is deciding to make a point. the president will talk about that later this afternoon. tom: annmarie hordern, thank you so much. i am sure you will continue your reporting. for those of you on radio, we have broken down to the lows of about november 19. we are not quite there yet. lisa abramowicz, $75.41 on wti. there is some persistent weakness here to see if we go through the november 19 level. lisa: this is a big move, the biggest driver from the strategic petroleum reserves. the idea that they are winning to take big action if it is

coordinated. now all eyes go to opec+. are they going to respond? can they try to offset this by reducing their output, or is this going to stick, at least in the short term, as we wait for things to normalize a bit more? tom: i wonder about the price dynamic. i want to go back to core micro economics. it is about units, which is barrels, versus actually affecting price. it is a lot harder to affect price. kailey: it is also going to take a wild to trickle down. as the president is facing plunging approval ratings in real time, looking for some kind of win or for the american public to recognize he is taking action, that isn't necessarily going to feel the impact of this immediately. it could take some time, and it ultimately is going to matter how large this group of countries as a whole, the tapping of their reserves actually ends up. right now we are at 55 million barrels. tom: can we do a segway? lisa: it depends. tom: we're doing a pre- makes giving -- pre-thanksgiving

segue. we have to go back to turkish lira. in the last few minutes, it has shockingly unraveled. i wonder, and i am saying this completely ad hoc, if we see imf action today. when does the imf stepien and do what the imf does? -- imf step in and do what the imf does? lisa: it is a jump in the lira as you see erdogan not backing away from his stance. tom: the president of the united states with the release of the strategic petroleum reserve. i will do the cap collation on lira. we are well out past the three standard deviation move on weaker turkish lira. stay with us worldwide come on radio, on television. this is bloomberg. ♪ ritika: with the first word news, i'm ritika. it is an unprecedented, coordinated attempt by some of the world's largest oil consumers to tame prices, and it

could prompt backlash by opec and its allies. the u.s. will release 50 million barrels of crude from its strategic petroleum reserve, in concert with china, japan, india, and south korea. that comes after the opec+ coalition rebuffed calls to get lee boost production. president biden is reportedly considering whether to send american military advisers to ukraine. the u.s. is also looking into sending more weapons to ukraine, including handheld antiaircraft missiles. russian forces on the border of ukraine pose the threat of invasion. the kremlin denies any aggressive intentions. china has pulled back on its already halting progress towards meeting u.s. trade deal targets after uncertainties marked the slowest pace in a year. china has now reached just 50% of its two-year goal. the biden administration has been pushing beijing to live up to its commitment's. meanwhile, china is facing its toughest coronavirus battle

since the first days of the pandemic. in response, the country is doubling down on its strict covid zero policy, despite rising costs to its people and economy. authorities are taking more extreme measures to contain the delta variant. state media is pushing the narrative that china is better off closed. a win for the body and -- for the biden administration, which once trader semiconductor -- which wants greater summit conductor -- greater semiconductor manufacturing. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. ♪

pres. biden: i am nominating jerome powell for a second term as chair of the federal reserve,

and i am nominating lael brainard to take the position of vice chair of the federal reserve. chair powell: american resilience cushions the blows and set the stage for a strong recovery. >> it means serving all americans in every community across the country and ensuring the diversity of the communities we serve. tom: the vice chairman nominee, lael brainard of wesleyan and harvard, speaking and teaching for years at the massachusetts institute of technology. it is an even full tuesday. we welcome all of you on radio and television. kailey leinz in her jonathan ferro. before we get to anastasia amoroso, india joins in. i did not know they had a strategic petroleum reserve. lisa: they are working with the

united states, so now it is india, china we already heard from. the execution that south korea and japan will also join in. how much of an effect will this have on price? a lot of that has to do with a plus -- with the opec+ response. tom: i would note that the 10 year real yield and portly goes through that benchmark of -1.00% to -0.99%. this is what the adults do on a bloomberg terminal. right now, turkish lira on a daily chart is up 3.2 standard deviations. the benchmark is four standard deviations come or you get in the crisis, and that is out at a 13.4x level. so we have quite a move to get to a calculated crisis of 13.48 lira to the dollar. lisa: although if you see such

great depreciation of your currency, as a resident of that nation, at what point does sentiment start to act as a check on policy that isn't working to bring down inflation? tom: ben bernanke would say, as would milton friedman and anna schwartz, it is always, and every case, about the banking and financial system which is under stress. that is a good introduction to anastasia amoroso, for years covering eastern europe, and now with i capital network -- with icapital network with a much broader remit. link in a higher oil price, real inflation worries that mr. erdogan has, some would say self-inflicted, and the destabilization of turkey. how idiosyncratic is it, or can it be a contagion? anastasia: i do think at this moment, it is idiosyncratic to turkey. there's just too many issues that have been building up for too long.

the current account deficit issues, the rundown of the reserves. when inflation is running at 20%, the last thing you do is cut interest rates. so this is a bit of a self-inflicted damage, and i don't think it is representative of the things happening in emerging markets, but perhaps identifying pockets of vulnerability is once again something we need to do. who has the twin deficits, who has low reserves, and who may not be able to withstand hikes from the federal reserve and a higher dollar? that might be one of the questions we have for emerging markets in 2022. but broadly speaking, a lot of them are much improved. lisa: there's also a question of erdogan fighting emerging markets, and policymakers are trying to jawbone down prices or jawbone up valuations. how do you operate as an investor at a time when

policymakers, and i am seeking of the federal reserve in particular, is trying to keep the status quo. we heard that the market will wind that they do not want to disrupt them. anastasia: i think the markets do ultimately prevail in the supply and demand balance. just to go back to the oil reserve and strategic petroleum reserve for a moment, it is a temporary move. i think it is the only thing within policy control at the moment. but is going to be a small move. i would say the reserve release we are seeing is more than consensus expected, but even if we released 30 million barrels, and that was leslie to translate into a downturn in price in two dollars a barrel or so, we will probably see something more than that. i do agree that this is just a temporary sense of control that i think policy makers are trying to exercise. but at the end of the day, it is what a supply and demand going to be, and for the broader economy, what is demand going to be and what is inflation going

to do. that is where the policy makers really need to respond. kailey: we have seen three times, emergency releases in u.s. history. it was during desert storm, katrina, and with libya in 2011. all of those was because you did not have access to that production. that is not the case here. you could see a ramping up of output from opec+ or shale players pumping more oil. how does that make this different? anastasia: it does set up a bit of a fight here because clearly, that is not something opec+ wanted to happen, was to have this coordinated strategic release. that is why they are talking about potentially not ramping up their production. but the reality that opec has to grapple with is that we are likely to be in a surplus market next year versus the deficit we have had, so i think they are going to calibrate the response carefully for that.

tom: do we need a strategic bitcoin reserve? let's go to your present wheelhouse. [laughter] anastasia: i do think more and more companies and more and more individuals are building out there could go currency reserves. i would expand that beyond bitcoin because bitcoin has been a great trade this year because inflation was surging in the fed was not doing anything about it. now the dollar is moving higher in the fed will seemingly do something about inflation next year. bitcoin has lost a little bit of its shine. first of all, you have to take a step back and look at the broader adoption trends of something like bitcoin, and i do think that is going to continue to grow. but near term, there's other cryptocurrencies that i think do play a good role in the cryptocurrency reserve. tom: anastasia, roso, think you so much. lisa abramowicz, i think the

kids are on the couch, and they just unloaded the hedge on oil. anastasia: maybe the oil -- lisa: maybe the oil reserves in my living room are why my children are really interested in bitcoin these days. it is perhaps easier to store. there will be a question of how we move the needle because we are seeing brent crude already erase losses, trading as much a 0.6 percent higher. how much has it already been priced in, and how much is this just creating a little bit of excitement on the terrain that really is dictated by supply and demand? tom: brent crude just printed innately that her level, up $.34. kailey: how much is the market expecting that opec+ may come in and counteract this? maybe they are calling the bluff on that. tom: but i'm going to speculate, there's a lot going on on a

tuesday. we are steeled for michael mckee and what we see tomorrow on comic data. right now, and this is really good, mark mccormick is going to join us. he has been wonderful this year on a resilient u.s. dollar. this will be must listen, must watch for global wall street. mark mccormick, td securities, next.

tom: an eventful tuesday. lisa abramowicz and tom keene. jon ferro is off. kailey leinz is in for jon ferro, and we are thrilled with that. we'll now, then we are going to look at the equity market, and then we stagger onto the dollar and collapsing turkish lira. on oil, help me here. the u.s. wants to drop oil prices to reach consumers. that was the goal, right? lisa: that was the goal, so they are saying they are going to release 50 million barrels. this would be the petroleum reserve in history, according to our own annmarie hordern, and rivals what we have seen in the past. the interesting thing we are seeing is the immediate knee-jerk reaction of lower oil has not stuck. we are seeing only a decline of 0.4% now on west texas

intermediate oil, with christians -- with questions about whether china will be coordinating in a big way, and how big the release will be, and opec+'s response. tom: brent crude printing $80 moments ago. i love the headline, u.s. says exchange oil to be returned to spr. i don't understand how you make a policy shift and then save you are going to reverse it three years out as well. let's go from oil now, where we are in west texas intermediate, $74.63, to the data on the screen, with the yield space pretty quiet sent -- pretty queer some -- pretty quiescent. let's get to kriti gupta. kriti: it translates right to the stock market.

oil companies that have more exposure to the domestic story, you can see they are actually up in the premarket, really following the action you are seeing in brent crude at the moment. what is not up his zoom, really dropping after losing for a second quarter, not meeting estimates about their large client numbers. some of that pendant and wearing off of a little bit. while we are talking about inflation and oil price which should be talking also about the global chip shortage. samsung saying they are deciding to build a plant in austin, texas to help build some of that semiconductor capacity on american soil. ordinarily that would be a negative for some of its components. tom: thank you so much. this is a joy and an immense honor that mark mccormick is with us as we see and emerging-market currency unravel. if you are just joining us, turkish lira is in full collapse. mark mccormick with td securities has been resilient

dollar all year. thrilled to have you wanted this historic moment for the people of turkey. i was out at 3.2 standard deviations half an hour ago. we have now collapsed out to 3.6 standard deviations, getting very close to what the textbooks would say is a point of crisis, four standard deviations out. how close is turkey to unraveling their financial system? mark: we are already pretty much there in terms of the major pivot point. i think what we are seeing is two factors. there's the local factor and the global factor. there's the negative feedback loop, and there is no credibility and how the government will manage its finances, and how the central bank will operate within that framework. so the market has completely lost confidence. when we get to the inflection point, it becomes a nonlinear rather than a linear discussion, and this is where we get the four standard deviation moment. at some point, someone will step in.

in terms of whether or not it is the market, the month of risk premium it will carry, but if you think about what is driving markets, it is liquidity. the dollar's rally largely because liquidity is coming out of the g10 bond markets. so to think about the emerging markets, which no one had a lot of confidence in the central bank, a lot of confidence in the government, no one is buying two-year turkey. no one is participating in turkey. that will exacerbate that. tom: the heat of been banker nag -- of ben bernanke is in crisis, watch the banks. what is the financial solidity right now of the turkish banks and their finance system? mark: that is not something in terms of our general connection that we will have access to, but a big part of it is how the market is responding and

conversations we are having about these type of topics. it really kind of comes around to if using about how these international investors are per dissipating, everybody want to talk about it, and nobody wants to do anything about it. i think that is the primary channel. there's a term amount of uncertainty. it is like when you try to catch a falling knife. my reading of that he leaves, from the people i speak with, is that no one wants to catch that falling knife just yet. lisa: we have been talking about how turkey is an idiosyncratic story. however, there is a larger pressure similar to other developed markets, particularly at the dollar does strengthen, as the fed is expected to raise rates. at what point do you start to see similar kinds of pressures and other developing market currencies. mark: that is a great question, and that is something our e.m. team went through in our global ethics outlook, which is kind of like what you are doing is looking at funding pressures. you are thinking about backing up higher interest rates in the

u.s. and one impact that has on capital flows. essentially, your primary focus is through latin america. if that a large current account deficit. someone needs to fund it. you now need international investors to participate in your fixed income or your equity market. when you think about that, and a world of rising rates, the biggest concern really runs through latin america, where you have large current account deficits and you are not offered the right carry cushion or offered to the right in terms of growth and covid reopening and feel comfortable buying this currencies yet. our e.m. team is really focused on how affordable it is next year, and how brazil could be an opportunity because there's still so much rates coming through in terms of the central bank hiking, so you will get real rates higher in brazil, which gives you that political

uncertainty cushion that will probably pull some investors into brazil next year. lisa: have valuations in the fx channel already taken into account two or three rate hikes next year, as the market is pricing in? mark: i think that is a big driver. if you think about 2022, as an institution we are very dovish on the fed. we don't expect the fed to move until 2023. we are looking for firmer equity prices, and i guess a correlation offset the comes into this is really it could be firmer risk appetite. not at the levels we saw in 2021. when using about what is price 10, what we have our real rates that are still going to be really subdued, still potentially negative. the mark it has to reprice the 50 basis points of tightening priced in for next year, price that out. timidly, you are reversing some of the expeditions around u.s. growth. we are looking for u.s. growth next year to fall around 3%,

which is way below market expectations. for me, i think we are in a world where we are trying to extrapolate the strength of the dollar and the hawkish fed into what is another 2022 annual outlook period. the outlook period i think is bullish the dollar, so our higher conviction is saying the world is going to be less correlated than it was, and there's a lot of divergence on terms of trade come on growth and valuations, but this is not a clear runway to just thing the dollar is going to rally as quickly as everyone is assuming at this point. kailey: -- so far, mark. you are looking at euro-dollar around one a dollars $.12 -- around one dollar 12 since. is that yen or you are weakness, or just a dollar strength story? mark: that is a good point because what people need to recognize is that the correlations has broken down.

if you look at euro-dollar versus dollar china, we have basically seen these two currencies completely v-8 at levels we have never seen before , so with dollar china is right, we should be at 121. there is an element that euro-dollar is doing its own thing. the biggest driver is nominal rate spreads. it is not really a real rates story. the two-year nominal's are about three times more importance than the real rates. so i think the euro-dollar is primarily a focus on the fed right now. i think people are worried about how covid reopening's are impacting germany and the netherlands, some of these big, important countries, because the euro zone growth is pretty solid compared to the u.s., so you need the valuation per you need to growth story. of those things are in flux. so i think there's an element here that the dollar-yen is about higher rates globally. stagflation, we know that is coming. but euro-dollar is a little trickier where i think if the

world starts to heal itself and we start to think about eurozone growth, we start to thing about where the relative discounts are at and if we to give out flows, there could be a cushion there early next year. tom: thank you so much. really one of the great out layer calls of a different view to 2022 and 2023. a rebound in oil, down we go with an intraday of $75.30. we come right back up to 70's expeller $.47. -- to $76.47. lisa: there is going to be a bid into that. i do wonder how much this ends up being the biden administration betting that supply and demand will right itself in a way that gives them a lot more leeway to be flux of a later on. tom: i want to digress to the value of the bloomberg terminal. we can go cross currency as best we can. we do look at turkish lira,

dollar-lira, but to the west, they look at euro-lira as well come out to a true four standard deviation move. that is a point of crisis. lisa: it is a point of crisis at a time when this nation has been absolutely battered with an inflation rate of astronomical proportions. you do wonder what kind of not contagion, but what kind of banking channels are looking stressed at this moment. tom: kailey leinz with us here. jon ferro off on an eventful tuesday. coming up at 8:30, michael feroli will join us of jp morgan. this will be a timely conversation. this is bloomberg. good morning. ♪ ritika: but the first word news, i'm ritika gupta. there's never been a coordinated attempt like this to bring down oil prices early of the u.s. will release 50 million barrels of crude from its strategic

petroleum reserve. china, japan, india, and south korea will also release some of their stockpiles in the decision to collectively discharge stored oil. the latest coronavirus wave in the u.s. is taking its toll in some states and care units. some parts of the country are seeing outbreaks that are as bad as ever. in 15 states, patients with confirmed or suspected covid are taking up more icu beds than a year ago. michigan now has the highest coronavirus case rate per capita in the u.s. president biden has dodged the risk of a senate confirmation fight over the federal reserve decision to reappoint jerome powell for another four-year term. it drew support from both democrats and republicans. some progressives -- the president also selected lael brainard to be vice chair. the u.k. fintech atom has moved

to a four-day workweek. employees will see their time at work cut by three and a half hours to 34 hours, with no change in salary. . shares of zoom lower premarket. the videoconferencing company reported a smaller than expect a number of customers for a second straight quarter, raising concerns about growth at a time when more is and schools are opening back up. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. ♪

>> i would be looking to end the mortgage-backed security purchases which i think serve no purpose other than inflating the

housing market almost immediately. i would be looking to accomplish the whole taper within about three months. tom: lawrence summers very much in the news on worries of inflation, the former secondary of the treasury. right now i've got oil churning here. brent crude green on the screen, $79.71. we will get to that in a moment with julian lee. right now on the equity markets and what we have all noticed, there's no brats. that's our lawyer is to it. that's that's all there is to it. -- that's all there is to it. dave: generally, it is looking for a number of stocks to move with an index because we want to see broader per dissipation in a market. even within technology, you are more concentrated.

at charles schwab, noting the other day that you are seeing increasingly that if you focus specifically on technology, and we talk about big tech, use or win communications, consumer discretionary, but focusing on technology in particular, you see apple, microsoft, and nvidia dominating the s&p 500 information technology to the point where there are 51% of its value. if you look at the top three stocks in that index historically, you are looking at the 5th street year in which the percentage weight for those top three is higher. tom: david wilson, thank you so much. something we will follow through the day. futures negative for the vix. one of the great joys of bloomberg's julian lee. he is acutely able out of london to look at the global dynamics of supply, demand, and the release of an american ind -- an

american, indian, and maybe global release of a strategic oil reserve. how global is this effort when i see $7.58 a gallon in london? julian: we are seeing a number of countries that look like they are going to join in to one degree or another. india has said it will release about 5 million barrels. we are expecting an announcement from japan, potentially south korea, may be china, and also the u.k., although our contribution might be relatively small. the figures look like they will stack up between about 60 million barrels low end to as much as perhaps 80 million barrels at the higher end. no real clarity at the moment what sort of timescale that release will cover.

clearly, if it is done over a single month, then we are looking at something that is significantly bigger than the u.s. was asking for from opec, for example. but even at its smallest, it aligned with what they were asking opec to do. in the meantime, we did get a lisa: lisa: release on japan. kailey noting that japan is set to release several days of oil reserves. it puts in -- it puts it into the sense of scale. how much would opec have to offset this by just increasing production for a couple of days? julian: i don't think opec or opec-plus is going to reduce its production. what it might well consider doing is delaying the increase that is currently scheduled for

january. i think decembers increase which was agreed at the beginning of this month is pretty much locked in. sales have been made against those program. but they may decide to delay the january increase in the february increase, and that would take, if you take 400,000 barrels a day, a potential increase of the market for a month, you're getting up to 12 million barrels. so you got to do that for two or three months to eat into all of this strategic supply release. kailey: how much daylight is there between what opec+ thinks is an appropriate price for a barrel of crude and what president biden thinks is the appropriate price for a barrel of crude? julian: that is a very good question, and one that i think

is fairly impossible to answer. opec seems to be back into this historical mindset where the bear price of oil is always a couple bucks more than the current price. and it doesn't really matter what the current prices. if it was 55, they were saying maybe around 70, and it always seems to be a little more than it is now. clearly for president biden, but he is much more interested in than the price of crude oil is the price of gas at the pump because that is what affects the americans who will or won't would for him. i think they concerns -- the concerns are the same here in the u.k. lisa: can you give us a sense of how much they declined we have seen in oil has resulted from talk of the spr versus the upsurge in covid cases that has severely current transportation,

certainly over in europe? julian: undoubtedly, both of these factors have had an impact. the spr release which has been strongly hinted at for the last two or three weeks has factored into people's assessment of the oil market. i think that this is one reason that we haven't seen prices tumble as the numbers have been announced because this release was already factored into where people saw the price leveling out. at the same time, we have mentioned that the rising covid cases come particularly in europe, where we are seeing new lockdowns being imposed in several countries, that is going to restrict manned but for transport fuels and probably also for some industrial fuels. we have seen reports of surges

in china with a big scaling back of domestic air travel, and i wa -- and as we get closer to the winter olympics early next year, there are expectations that china's energy use will be pulled back in order to meet clean air targets. tom: julian, thank you so much, on not a u.s., but a global strategic petroleum reserve. i've got to look at the bond market come out to 2.01%. it is a spike up -- is it a spike up? no, but nevertheless, back to where it was december 17. yield is higher today. lisa: particularly on the front end. 0.6 more percent on the front end for the 2-year note after yesterday's auction which was really weak. really tells you where we are as people contemplate the new fed chair powell. tom: wti, $76 four cents --

$76.044. please stay with us. on radio, on television, this is bloomberg. ♪

>> what i think we are all mainly a worried about is a fed policy mistake. >> inflation is popping up as the main problem facing the fed, which hasn't been true for years. >> powell has also put a big focus on employment. >> fed forward guidance in this new world just can't go as far as it did in the past. >> i think the fed won't act for a long time. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. lisa: fighting inflation was an oil dump, but prepare for the data dump. good morning.

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