Over the past week, multiple stories have appeared in the media with headline phrases like “The U.S. is refilling the Strategic Petroleum Reserves.” However, this is misleading at best.
To recap, the SPR is maintained by the U.S. Department of Energy, and its oil stocks are stored in huge underground salt caverns at four sites along the coastline of the Gulf of Mexico. The size of the SPR (authorized storage capacity of 714 million barrels) makes it a significant deterrent to oil import cutoffs and a key tool in foreign policy.
After Russia invaded Ukraine, the Biden Administration made the largest withdrawal in SPR history in an effort to curb the oil price spikes that happened in the wake of the invasion. Between Biden’s inauguration in 2021 and mid-2023, 291 million barrels were sold from the SPR. That 46% reduction took SPR volumes to a level last seen in 1983.
Since hitting a low level of 347 million barrels in June 2023, the Biden Administration has returned about 14 million barrels of the 291 million removed (4.8%).