According to a Reuters article, the US said on Monday that it was seeking to purchase up to three million barrels to replenish its Strategic Petroleum Reserve.
Purchases will continue through next May, with delivery to the Bryan Mound location in Texas.
According to the report, the amount of money the government will have available for future purchases is limited until lawmakers give more funding.
In order to keep local gas prices from rising, the government has decided to replenish its crude oil reserves.
The US Energy Information Administration reports that the SPR had about 384.6 millions barrels of crude as of October 18,
Biden Government authorized sale after Russia invaded Ukraine in 2022
After the Russian invasion of Ukraine, US President Joe Biden authorized a massive 180 million barrel sale in 2014. Gasoline prices had spiked.
Brent oil prices rose to almost $140 a barrel after the invasion of Moscow, a record high for more than 14 years.
Fuel prices in the US skyrocketed as a consequence. Private players were allowed to sell oil in the US.
Since then, the US government has bought back 55,000,000 barrels of crude oil on average at $76 per barrel.
Reuters reported that the price is almost $20 less than what it charged for oil barrels in 2022.
US Energy Department not getting enough funding
According to Reuters, to refill the SPR the Department of Energy of the US worked with legislators to cancel a planned sale of 140,000,000 barrels of crude oil for late 2022.
Reuters reported that both Democratic and Republican legislators had voted in favor of these sales as a way to fund government programs.
It is not clear how much money the Department has left to purchase more oil. A spokesperson for the department told Reuters that there was about $150 million remaining, enough to buy about 2,000,000 barrels.
SPR Politics
Kevin Book, a research analyst with ClearView Energy Partners (a nonpartisan group), told Reuters that the politicization SPR would make it difficult for legislators to reach an agreement.
There are more questions surrounding the upcoming US elections.
It could be difficult for the next government to get Congress on board to finance SPR funds in energy departments.
Working with legislators could include the cancelation of the Congress deal for future sales of the SPR of 100,000,000 barrels of crude between 2026-2031.
The post US seeking up to 3,000,000 barrels of crude to replenish strategic reserves could be updated as new information becomes available
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