The Biden administration plans to seek up to 6 million barrels of oil for the Strategic Petroleum Reserve (SPR), a move that could match its largest replenishment effort following a historic sale in 2022. The announcement is expected as soon as Wednesday, with the oil intended for delivery to the Bayou Choctaw site in Louisiana, one of the reserve’s key locations.
This purchase comes as the Department of Energy aims to capitalize on relatively low crude oil prices, currently around $71.70 per barrel, which are below the target buyback price of $79.99 per barrel set after the 2022 sale of 180 million barrels. The administration has already repurchased over 50 million barrels since the sale, which was initiated in response to rising gasoline prices following Russia’s invasion of Ukraine.
Despite the current low prices, factors such as ongoing conflicts in the Middle East could quickly drive prices up, as seen in April when a planned SPR purchase was canceled due to rising costs. The reserve currently holds approximately 380 million barrels, significantly lower than its peak of nearly 727 million barrels in 2009.