The US Department of Energy said on Tuesday it is looking to buy 1 million barrels of crude oil for delivery to the Strategic Petroleum Reserve, as it seeks to take advantage of relatively low oil prices to help replenish the stockpile.
The previous administration of former President Joe Biden sold record amounts of oil from the SPR, including a 180-million-barrel sale after Russia, one of the world’s top oil producers, invaded Ukraine in 2022. The reserve, which has about a 700-million-barrel capacity, is now holding nearly 409 million barrels.
President Donald Trump’s administration has been looking to replenish the SPR, but has been limited by a lack of funds and by ongoing maintenance at the reserve, held in a series of hollowed-out salt caverns on the Texas and Louisiana coasts. Pumps, pipes and other above-ground SPR infrastructure are constantly exposed to corrosive, salty air. Trump’s tax and spending bill included about $171 million for the SPR oil purchases and maintenance, much less than the $1.3 billion that had originally been in the legislation. Buying more oil for the SPR will likely require the passage of new legislation. Energy Secretary Chris Wright said Trump is trying to replenish the SPR with the help of Congress. “While this process won’t be complete overnight, these actions are an important step in strengthening our energy security and reversing the costly and irresponsible energy policies of the last administration,” Wright said.
Both the international oil benchmark Brent and the US benchmark WTI had hit their lowest levels since early May on Monday, as record US oil production and a decision by the Organization of the Petroleum Exporting Countries and allies to press ahead with planned supply hikes raised expectations of oversupply.
WTI crude futures on Tuesday closed up 30 cents at $57.82 a barrel.
Bids for the SPR solicitation close on October 28.
