Two pieces of recently enacted legislation open up the possibility for significant sales of crude oil from the US’ Strategic Petroleum Reserve (SPR) over the next ten years.
The Bipartisan Budget Act authorises the sale of 58 million barrels of SPR oil between 2018 to 2025 for deficit reduction purposes and an estimated 40 to 50 million barrels of oil between 2017 and 2020 for SPR modernisation.
Under the Act, the US Department of Energy is required to complete a long-term strategic review of the SPR to ensure it meets current and future energy and economic security goals and objectives.
The Fixing America’s Surface Transportation Act authorises the sale of 66 million barrels of oil in 2023 to 2025 to help support the Highway Trust Fund.
The SPR is located in four storage sites along the Gulf of Mexico and holds more than 695 million barrels of crude oil – around 96% of its 727 million barrel design capacity.
Recent figures show that the SPR hold crude oil stocks equivalent to 156 days of import protection. Total days of import coverage provided by strategic and commercial stocks is currently 450 days.