On Wednesday, the Biden administration announced that it would pull an additional 15 million barrels of oil out of the nation’s Strategic Petroleum Reserve (SPR) to help juice up oil supplies and keep gas prices low in the face of the global energy crisis.
The 15 million barrels, which will be delivered in December, are the final part of an extended release that has been going on since May. After this release, the number of barrels let out of the reserve will total 180 million over the past five months. This is the most oil ever released from the SPR in the stockpile’s nearly 50-year history; a Treasury Department analysis found that this extended release may have lowered oil prices by as much as $US0.40 ($0.64) per gallon over that period. According to AAA, national petrol prices on Wednesday morning hovered at just over $US3.85 ($5) a gallon (around 3 litres).
Some administration officials also told reporters that an additional 15 million barrels could be released from the SPR. The move is partially in response to oil cartel OPEC announcing last week that it would cut oil production, which caused prices to go higher.
“The Department of Energy remains very able, very vigilant, if we need to deal with additional challenges with supply, with affordability, then we will have additional opportunity with the SPR if we need to do more sales into the future beyond that December time period,” one senior administration official told journalists on Tuesday, as reported by NPR.
The Strategic Petroleum Reserve was started in the 1970s, when the U.S., facing another global energy crisis, began to squirrel away oil for a rainy day. In a cool sci-fi-esque flair to this whole saga, the oil is stored in underground salt caverns — which, according to the Department of Energy, are the most secure and cheapest form of storage — at four sites in Texas and Louisiana.
While 180 million barrels is a lot of oil, we’ve got a lot sitting underground in those caverns: the SPR can hold about 714 million barrels. The biggest cavern, the DOE says, is “large enough for Chicago’s Willis Tower to fit inside with room to spare.” Those are some big salt caves!
But Biden has leaned heavy on the supplies in the SPR since taking office: the SPR has declined by 36% since his administration began. This latest release means there’s some 400 million barrels left in the reserve — the lowest level since its inception.
The SPR’s existence has long functioned as a political flashpoint. When President Trump was in office, he toyed with the idea of doing away with the SPR altogether, but ended up buying more oil from producers to prop up the industry as prices plummeted during the pandemic. This latest release comes just a few weeks before the U.S. midterms, where gas prices are a primary concern for voters; some House and Senate Republicans have already falsely blamed the need for the sale on Biden’s domestic energy policies, rather than geopolitical influence. The administration has said that it has plans to restock the SPR when prices are lower.