White House Delays Refill Of Strategic Oil Reserve – IOTW Report

White House Delays Refill Of Strategic Oil Reserve

ZeroHedge: The Biden administration had no problems aggressively draining the SPR by 1mmb/d at market prices in the immediate aftermath of the Ukraine war, in hopes of lowering the price of gasoline ahead of November’s elections and avoiding an inflationary midterm rout. However, when it comes to refilling the SPR, now that US emergency inventories are down to the lowest level since November 1983 and not too far from an all time low which threatens the structural integrity of the salt caverns the oil is deposited in…

… the White House has “unexpectedly” gotten cold feet.

One month after the White House said it will start refilling the Strategic Petroleum Reserve, and made an initial order of 3mm barrels of sour crude (a tiny fraction of the 200 million released in 2022), in what it said was a clear message to oil companies that they can freely invest capital in boosting output cause, well, Biden’s got their backs, overnight we learned that there was a rather sizable caveat in the White House’s brilliant plan.

According to Bloomberg, the Biden administration has delayed the replenishment of the nation’s emergency oil reserve after deciding the offers it received were either too expensive or didn’t meet the required specifications.  Citing “people familiar” the report adds that “the Department of Energy rejected the several offers it got for a potential purchase in February.” In other words, absent a brutal US or global recession which drags oil far lower – courtesy of the Fed which is doing Biden’s bidding of containing inflation by crushing the US economy with the highest interest rates in a generation – the SPR won’t get any more oil.

While the DOE will put off the purchase it had originally planned for next month, the proposed program, which used a new approach that accepts fixed-price offers, will continue, one of the people said. Of course, it will “continue” only as long as oil is below a certain White House mandated threshold, anything above that – as we now can see – means no refills. As a reminder, last year there were reports that the Biden administration had planned to start buying crude when it dropped around $70 a barrel; and while oil fell during the fourth quarter and US benchmark prices fell close to those levels last month, they have since rebounded, with the SPR refill price serving as a market support level. more

19 Comments on White House Delays Refill Of Strategic Oil Reserve

  1. “What percent of our strategic weapons reserve have they given away?”

    Rumor has it you can’t find a had held rocket launcher, of any type, on a U.S. military instillation.

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  2. So now we have no oil, a weak military, corrupt govt, corrupt culture, open borders, rampant crime.
    If it weren’t for all us gun owners in this country now would be the time to attack.

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  3. @Jellybean: The only thing lower than our oil reserves is the democrats ability to function as a governing body that adheres to true American values.
    Yep they sure showed the dems getting the House speaker voted on. But hell we all love watching a good ole cat fight, moe popcorn please. Shit they’ll have trouble deciding on where to get lunch. Kentucky Fried or McD’s.

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