The Strategic Petroleum Reserve was created in the wake of the Arab oil embargo of 1973-74 to prevent, or at least reduce, the economic damage were such an event to happen again. Since then, the SPR has been something of a toy politicians of both major parties have used to justify or “pay for” other government programs.
But the Biden administration's recent and substantial use of the SPR has created a different problem: the reservoir is running dry.
According to The Wall Street Journal:
…the Strategic Petroleum Reserve declined by nearly 7 million barrels in the week ended Sept. 16, leaving it at roughly 427 million barrels—the lowest since 1984. For the first time since 1983, the SPR now holds less oil than commercial storage.
And what does this mean for the SPR's stated mission – energy security?
…the U.S. needs a fully functioning air bag. Alas, this one comes with diminished cushioning capacity. Though the president can technically authorize more SPR drawdowns, there will be a limit, given that the IEA has a minimum stockholding obligation for participating members. RBC Capital Markets previously pegged that number for the U.S. at roughly 315 million barrels. And the DOE will eventually have to replenish the SPR by the same amount that it drew this year, increasing future oil demand. A DOE spokesperson said replenishment won't likely occur until September 2023.
Besides the short-term political gain, the SPR draw could turn out to have been a losing strategy however the supply-demand balance shakes out. If there is an actual oil shock and not enough oil in the SPR to cushion it, it would be a painful lesson on why the reserve exists in the first place.
Regardless of what one thinks of the SPR as a government entity (and small government advocates have long said the SPR needs to go away), it's going to be around for a while.
Which means it needs to be refilled at a time when energy markets are unsettled, and the prevailing political will in many national capitals is to demonize petroleum in all forms, and for all uses. Bad news, indeed, if we're at all concerned about “energy security,” or “price stability.” Never mind avoiding the harsh economic fallout of a 1970s-style oil shock.
The opinions expressed in this article are those of the author and do not necessarily reflect the positions of American Liberty News.
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Since when can a President of the USA give away something that belongs to the American people without congress signing off on it? My guess is there is something bigger going on that we don
t know about. We cannot sustain our way of life with all the trash illegals feeding off of the American taxpayers. Im ready for war myself. What I am paying in taxes would pay for a family of 4 illegals. This is what they do with my tax dollars? They are talking about new infrastructure money? Ask yourself where did the infrastructure money go that Obama got? No one is saying anything about the billions that have been given to our enemies. I thought they were supposed to vote on these things. It`s time for term limits and the downsizing of our government.Quit draining the SPR U fool, refill
Slo joe is a corrupt, stupid fool. He needs to be brought up on charges of treason. The dems make up lies to go after the best , President Trump and they have all this evidence on slo joe and nothing happens. Joe needs to be up on treason charges.
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The people of this country know where the oil has been going and it hasn’t been to the USA. It has been going to communist and enemy countries. The people have not given a go ahead to give our oil reserve away and Congress hasn’t signed on it to be given away. Only Biden has taken it upon himself to do these things. What are we supposed to do when it comes time for us to need that oil?
If it was Trump who did that the always hypocrite Democrats would be demanding to impeache Trump a third time.
“the administration admitted that it even recently sold roughly 1 million barrels from the emergency fund to a Chinese government-owned gas giant that continues to purchase Russian oil.”
“We did not get to this pain point by accident, and despite Democrats’ desire to deflect blame, the high prices of gas are not due to Russia’s war, price gouging, or corporate greed. Americans are paying more at the pump because of the Biden administration’s deliberate war on domestic energy production. Biden promised on the campaign trail that he would end domestic drilling, and he has done his best to honor that promise, despite the catastrophic pain it is causing consumers.”
He doesn’t care as long as we keep paying to fill up the Beast he’s happy. Also when is he going to have the Beast convertered to electric
Biden is paying back to China for the $30 million that they funneled to Biden by giving away to China our oil reserves. Communists in action. Where is our Congress to call this man out.
Purloining the reserves of the American people and if reports be true, selling them to the Chinks? Joey, Joey, say it ain’t so! (Let’s Go Brandon!)