The Biden administration has canceled two scheduled oil buys meant to refill the Strategic Petroleum Reserve (SPR), as confirmed by the Department of Energy on Wednesday.
The scheduled buys would have obtained 3 million barrels later this year, which is part of a bigger plan to completely refill the SPR by the end of the year. The Energy Department had previously announced the planned purchases, which were set to be delivered to a Louisiana facility, in March.
“Being mindful of the taxpayer's interest, we will not award for the Bayou Choctaw SPR site in August and September, and will continue to seek available capacity as market conditions permit,” an Energy Department spokesperson informed The Hill. “As always, we monitor market dynamics to remain adaptable and innovative in our successful replenishment approach to protect this critical national security asset.”
The Biden administration took out about 50 million barrels from the SPR in November 2021 in the hope of stabilizing gas prices. Following the energy shocks from the Russian invasion of Ukraine, the administration announced the biggest-ever withdrawals from the stockpile, including a daily release of 1 million barrels over 180 days.
At that time, the administration pledged to replenish the SPR based on market conditions, aiming to repurchase oil when prices are $79 a barrel or less.
However, at the time of the last buyback in March, oil was about $81 a barrel, when the U.S. bought back nearly 3 million barrels. The U.S. benchmark West Texas Intermediate has experienced a recent increase, exceeding $85 for the first time in six months earlier this week.
The Department of Energy has repurchased about 32.3 million barrels for the SPR overall since last year. The stockpile, which initially held around 600 million barrels before the Ukraine invasion, remains just over half full, containing slightly over 363 million barrels as of April.
