By Timothy Gardner
WASHINGTON (Reuters) – The Biden administration said on Friday it has bought its last batch of oil for the Strategic Petroleum Reserve after selling a record amount from the facility in 2022 to counter fuel prices that had risen after Russia’s invasion of Ukraine.
The Department of Energy said it had bought 2.4 million barrels of oil for the reserve for delivery from April through May to the SPR’s Bryan Mound, Texas site.
The purchase depleted the department’s fund to buy back more oil for the reserve, it said. The 2022 sale of 180 million barrels of crude had raised nearly $17 billion in emergency revenue for buybacks, but Congress had rescinded about $2.05 billion to help offset the national deficit.
The Biden administration has bought back 59 million barrels after the 2022 sale at an average price of less than $76 a barrel, far lower than the $95 a barrel it sold oil in 2022. That resulted in a profit of about $3.5 billion, the DOE said.
U.S. Secretary of Energy Jennifer Granholm said the effort cements the administration’s “commitment of putting the economic and energy security of the American people first with actions that steadied prices at the pump, provided certainty to industry, and maintained the SPR as the world’s largest supply of emergency crude oil.”
The Biden administration also worked with Congress to cancel congressionally-mandated sales of 140 million barrels of SPR oil through 2027 that both Democratic and Republican lawmakers had voted for.
President-elect Donald Trump, a Republican, will have to work with Congress to replenish the department’s purchasing fund. Trump has said he would put oil into the SPR.
The 2022 sale of 180 million barrels over six months was the biggest sale ever from the SPR. It helped to counter U.S. gasoline prices that spiked to record prices of more than $5 a gallon in June, 2022.
It also sank SPR levels to the lowest in 40 years of under 350 million barrels, sparking criticism from some lawmakers who said it cut into the U.S. energy security buffer. The SPR currently has nearly 390 million barrels. The most oil it ever held was nearly 727 million barrels in 2009.
The U.S., however, is now the world’s largest oil and gas producer, thanks to techniques such as fracking and horizontal drilling. It is more energy secure than in the mid-1970s, when Washington created the SPR, the world’s largest emergency oil stash, after supply shocks including the Arab oil embargo.
This post is originally published on INVESTING.
