- The Biden Administration has just returned about 14 million barrels to the SPR after a considerable drawdown, with current cancellations of refill strategies.
- Rising oil costs have led the DOE to cancel setup solicitations, delaying efforts to renew the SPR.
- Current and prepared purchases fall brief of the levels required to substantially fillup the SPR before the upcoming election.
Over the past week, several stories have appeared in the media with heading expressions like “The U.S. is fillingup the Strategic Petroleum Reserves.” However, this is deceptive at finest.
To wrap-up, the SPR is kept by the U.S. Department of Energy, and its oil stocks are kept in substantial underground salt caverns at 4 websites along the shoreline of the Gulf of Mexico. The size of the SPR (authorized storage capability of 714 million barrels) makes it a considerable deterrent to oil import cutoffs and a secret tool in foreign policy.
After Russia attacked Ukraine, the Biden Administration made the biggest withdrawal in SPR history in an effort to curb the oil cost spikes that occurred in the wake of the intrusion. Between Biden’s inauguration in 2021 and mid-2023, 291 million barrels were offered from the SPR. That 46% decrease took SPR volumes to a level last seen in 1983.
Since striking a low level of 347 million barrels in June 2023, the Biden Administration has returned about 14 million barrels of the 291 million gotridof (4.8%).
The DOE has regularly assured to refill the SPR as market conditions permit. Although formerly showing they would fillup the Strategic Petroleum Reserve (SPR) by the end of 2024, the DOE recently canceled solicitations.
Citing increasing oil rates, the DOE stated, “We will not award the existing solicitations for the Bayou Choctaw SPR website and will get readilyavailable capability as market conditions enable.” Three million barrels of oil hadactually been slated for shipment to