WASHINGTON, D.C.-The U.S. Department of Energy today announced that 200 million barrels of crude oil have been delivered, contracted at a good deal for taxpayers, an average price of $74.75. following the closure of the most recent solicitation to acquire 2.4 million barrels of crude oil for the Strategic Petroleum Reserve (SPR). This aggressive buyback strategy has resulted in the purchase of 20 million barrels more than the 180 million barrels sold under the emergency declaration authorized by President Biden in 2022 following the unpreceded Russian invasion of Ukraine.
To date, DOE has directly purchased 59 million barrels of oil for the SPR at an average price of under $76 per barrel. This is about $20 per barrel lower than the $95 average sales price for 2022’s emergency sales. In addition, DOE secured 140 million barrels by working with Congress to cancel mandated sales between FY24 and FY26, at approximately $74 a barrel. Together, this brings the total oil purchased or retained in the Strategic Petroleum Reserve (SPR) since 2022 to nearly 200 million barrels.
“With the awarding of these contracts, DOE has fully utilized all funding allocated for crude oil purchases following the sale of 180 million barrels in response to the Russian invasion of Ukraine and secured 20 million more barrels at a good price for taxpayers,” said U.S. Secretary of Energy Jennifer M. Granholm. “This milestone cements President Biden and Vice President Harris’ commitment of putting the economic and energy security of the American people first with actions that steadied prices at the pump, provided certainty to industry, and maintained the SPR as the world’s largest supply of emergency crude oil.”
All $16.95B in emergency revenue made from the 2022 sale was used to secure these barrels, except for the $2.05B that was rescinded by Congress for deficit offset. Additionally, DOE accelerated approximately 5 million barrels in exchange returns, to further support the SPR refill and ensure all available windows for efficient replenishment were taken advantage of – helping to increase volumes in preparation for future emergency needs for replenishment. This milestone underscores the Biden-Harris Administration’s commitment to safeguard and replenish this critical energy security asset. This with a robust three-part strategy first announced in early 2023.
This unprecedented replenishment follows the historic release from the SPR to address the significant global supply disruption caused by Putin’s war on Ukraine and help keep the domestic market well supplied, ultimately helping to bring down prices for American consumers and businesses. Analysis from the Department of the Treasury indicates that SPR releases in 2022, along with coordinated releases from international partners, reduced gasoline prices by as much as 40 cents per gallon.
The contracts awarded on November 7, 2024, are for deliveries totaling 2.4 million barrels beginning in April 2025 through May 2025 to the Bryan Mound site following the Request for Proposal (RFP) that was announced on October 28, 2024. For the 2.4 million barrels of oil purchased for the Bryan Mound site, 18 proposals were submitted to the RFP. DOE awarded contracts to the most competitive bids that met quality and specification requirements. The crude oil will be delivered to the Bryan Mound SPR storage site from April 1, 2025, through May 31, 2025.
The Administration’s successful three-part replenishment strategy aimed to get the best deal for taxpayers while increasing SPR stocks included: (1) Direct purchases with revenues from emergency sales; (2) Exchange returns that include a premium of oil above the volume delivered; and (3) Securing legislative solutions that avoid unnecessary sales unrelated to supply disruptions. The SPR continues to be the world’s largest known supply of emergency crude oil.
The federally owned oil stocks are stored in underground salt caverns at four sites in Texas and Louisiana. Through scheduled maintenance periods and the Life Extension 2 program, DOE continues to prioritize the operational integrity of the SPR to ensure that it can continue to meet its mission as a critical energy security asset. The SPR has a long history of protecting the economy and American livelihoods in times of emergency oil shortages.