Cardinal Energy Ltd (Alberta) T.CJ

Funds for refilling the SPR has only $841 left

[VeritasVern]

That equates to only 12 Mb at $70. Looks like they spend the money collected when the sold 290 Mb on roads, medicatoin and deficit spending ect. 

By Ari Natter

September 17, 2024 at 6:32 AM CDT

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Welcome to our guide to the energy and commodities powering the global economy. Today, reporter Ari Natter looks at the Biden administration’s struggle to refill the US Strategic Petroleum Reserve. To get this newsletter sent straight to your inbox, you can sign up here.

With oil bumping along near $70 a barrel, this should be the perfect time for the US to refill its depleted emergency stockpile.

The administration of President Joe Biden sold off a record amount of crude from the Strategic Petroleum Reserve over a six-month stretch in 2022, when the average price was $95 per barrel. Replacing supplies at current prices would be a nice deal.

The problem is the government’s crude-procurement fund doesn’t have enough cash to pull it off.

The Energy Department account to buy oil for stockpiling is down to about $841 million, according to an estimate by the consulting firm ClearView Energy Partners. It would stretch to about 12 million barrels at today’s prices.

That would be a mere fraction of the 320-million-barrel shortfall between the current amount stockpiled and the SPR’s maximum capacity of more than 700 million barrels.

The reserve’s level has been at or close to a four-decade low since the Biden administration sold 180 million barrels into the global market in an attempt to bring down gasoline prices following Russia’s 2022 invasion of Ukraine.

The Energy Department didn’t respond to requests for comment.

Long Road to Refill Oil Reserves

US emergency crude stockpiles are crawling back from a 40-year low

 

All told, the US has sold about 290 million barrels under Biden. Part of that has been through sales mandated by Congress, which uses the cash for roads, drugs, deficit reduction and other things that don’t necessarily have anything to do with energy.

Officials are slowly refilling the reserve, saying it’s crucial to the nation’s energy security. That includes buying about 50 million barrels of oil and securing the return of 5 million barrels loaned to oil companies. The administration has also asked lawmakers to cancel upcoming congressionally-mandated sales to keep levels from slipping further.

Congress could, of course, allocate more money to the Energy Department, allowing it to take advantage of low prices to buy crude. But that’s a tough ask during a highly polarized election year.

[Quintessential1]

Why don't they just magically fill the SPR the same way they have been magically lowering prices? Seriously though aside from a lower buying price opportunity why would they want to? Bigger buys will only raise prices by mimicing increased demand.   There is lower forecasted demand and lots of supply so what's their hurry? Re-filling the SPR isn't a big enough problem to

[VeritasVern]

The question of how effective the SPR actions are I imagine it is related to some politicians that said 1 Mb per day of additional supply would not make much of a difference when the world consumes 102 Mb/day. True or not or even partially true, that is typically what all politicians do - criticize the policy of the other party. The question of using the SPR for lowering prices was also raised as

[Quintessential1]

Nowhere in the story does it state this: "But the point to the story is that they assured us they were going to sell oil in the SPR at an average of $95 and refill at $79 or below" It does say that it would seem like the perfect time to do so.  But for the Biden administration it would seem like it might not be the perfect time. So they might not.  The question of using

[VeritasVern]

Yes the news article doesn't specifically say that, but certainly implies it...correct me if I am wrong but hasn't most, except yourself, heard quite a few times at least, that they were selling at high prices and refilling at $79 or below... But nowhere does the article say or imply: "But for the Biden administration it would seem like it might not be the perfect time. So they

[Quintessential1]

Actually I'm not sure they ever said they were selling at high prices but they did.   They did say they would be refilling below $79 and they have. If they are out of money and spent it on the American people they can't really complain and as you said before most Americans could care less about the status of the SPR as long as gasoline is cheap and it is. GLTA