The Biden administration plans to sell more crude oil from the Strategic Petroleum Reserve, meeting budget guidelines ordered years ago that it had tried to halt as oil prices have stabilized.
The sale ordered by Congress will amount to 26 million barrels of crude oil, according to people familiar with the matter. The sale is in line with a budget mandate passed in 2015 for the current fiscal year, an Energy Department spokesman said.
The Energy Department has sought to halt some of the sales required by the 2015 legislation in order to replenish the emergency reserve, which currently stands at about 371 million barrels. After this latest release, the reserve will drop to around 345 million.
Biden officials last year decided to draw 180 million barrels from the strategic reserve in an effort to ease supply problems after Russia invaded Ukraine, disrupting global oil flows and sending crude above $100 on barrel Some Republicans have criticized the Biden administration for the reduction, which was the largest rollback ever and helped drain the SPR to its lowest level since 1983. Critics warned the move was a political stunt aimed at combat rising gas prices ahead of the midterm elections.
Since then, Biden officials have talked to energy companies about buying oil to fill the SPR when prices approach $70 a barrel.
The latest statement comes after Russia unveiled plans to cut output by half a million barrels a day next month to retaliate against sanctions. Russia’s move, which was played down by the European Union, follows China’s rapid economic reopening with the lifting of Covid-19 restrictions. The SPR release may give pause to the OPEC+ alliance, which earlier said global oil markets remain balanced.
The US House last month passed legislation aimed at curbing the energy secretary’s ability to use the reserve unless the government increases the amount of federal land available for oil and gas drilling.
Other releases required by Congress — about 140 million barrels planned for fiscal years 2024 to 2027 — were canceled at the Energy Department.
