The United States government announced today that it is acquiring up to 3 million barrels of oil for the Strategic Petroleum Reserve (SPR). Oil is scheduled to be delivered to the SPR’s Bryan Mound site in Texas from April to May 2025. This move is part of a broader initiative to replenish the SPR following the record sale of 180 million barrels in 2022, decided by President Joe Biden in response to soaring gasoline prices due to Russia’s invasion of Ukraine.
The Department of Energy (DOE) has already repurchased more than 55 million barrels at an average cost of approximately $76 per barrel. This price is significantly lower than the $95 per barrel that oil was sold for last year. DOE’s efforts to restore the SPR also included working with lawmakers to cancel 140 million barrels of congressionally mandated sales scheduled through 2027, originally intended to fund government programs.
The exact remaining balance of the DOE fund for additional oil purchases is not publicly known. In early October, a department source indicated that around $150 million was available, which would be enough to purchase around 2 million barrels. However, a DOE spokesperson said Monday that there is slightly more than that amount, allowing the department to “continue to purchase crude oil at a good price for taxpayers with available emergency revenues.”
To fully replenish the SPR procurement fund, the Biden administration or the next administration will need to work with Congress. Kevin Book, a policy analyst at ClearView Energy Partners, noted that while some funds may remain after this latest solicitation, they would be minimal. He also highlighted the political challenges in obtaining additional resupply due to the politicization of the SPR.
In addition to purchasing oil, DOE could consider working with Congress to cancel future mandated sales of approximately 100 million barrels of oil from 2026 to 2031. This strategy could potentially reduce wear and tear on the state’s underground caverns. SPRs located along the coasts of Texas and Louisiana, which serve as storage for the reserve.
Reuters contributed to this article.
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