The US Department of Energy (DOE) has announced that it will put 18 million bbl of crude oil from the US strategic petroleum reserve (SPR) on sale on December 17 2021 as part of a previously announced plan to reduce fuel prices.
In November 2021, US president Joe Biden ordered the release of up to 50 million bbl of oil from the US SPR, after a request to OPEC and Russia to increase oil production was refused. Several other high-energy consuming nations, including China, India, Japan, South Korea and the UK also agreed to release oil from their SPRs. Oil prices had risen to their highest level for seven years after demand outstripped supply. Prices have since begun to drop, but the US is pressing ahead with plans regardless.
Oil is being released on a combined sale and exchange basis. Parties interested in the upcoming sale should register through the SPR website. The first exchange of 4.8 million bbl, will go to ExxonMobil.
Delivery will be conducted from the Bryan Mound, West Hackberry, and Bayou Choctaw SPR storage sites. The DOE says it will continue to accept bids from interested parties for the additional barrels authorised for exchange. Oil authorised for exchange must be returned to the SPR on a set date.
“Exchanges and sales from the strategic petroleum reserve are important tools we are using to address oil supply disruptions as the world recovers from a once-in-a-century pandemic,” said DOE secretary Jennifer M Granholm. “The president rightly believes Americans deserve relief now and has authorised the use of the SPR to respond to market imbalances and reduce costs for consumers.”
For more information visit www.energy.gov
