New Purchase of up to 3 million Barrels Shows Administration’s Continued Success in Replenishing Reserve at a Good Deal for American Taxpayers as DOE Maintains the SPR’s Operational Readiness and Protects the Nation’s Energy Security

WASHINGTON, D.C. — Today, the U.S. Department of Energy’s (DOE) Office of Petroleum Reserves announced that contracts have been awarded for the acquisition of 2.95 million barrels of U.S.-produced crude oil for the Strategic Petroleum Reserve (SPR). The contracts awarded today are fully subscribed for a June delivery following the Request for Proposal (RFP) that was announced on January 31, 2024. The 2.95 million barrels are being purchased for an average price of $77.81, well below the average of about $95 per barrel that SPR crude was sold for in 2022, securing a good deal for taxpayers. To date, DOE has purchased a total of 23.08 million barrels of oil for the SPR for an average price of $76.34 as well as accelerated nearly 4 million barrels of exchange returns, pursuant to its strategy to refill the SPR. DOE will continue to evaluate options to refill the SPR while securing a good deal for taxpayers, taking into account planned exchange returns and market developments.

Today’s announcement advances the President’s commitment to safeguard and replenish this critical energy security asset. This follows President Biden’s 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 last year, along with coordinated releases from international partners, reduced gasoline prices by as much as 40 cents per gallon. 

A total of 8 companies responded to the RFP, submitting 32 proposals, and the contracts were awarded to 4 companies that met quality and spec requirements, in addition to providing competitive bids. The crude oil will be delivered to the Big Hill SPR storage site from June 1, 2024, to June 30, 2024. 

The Administration’s ongoing three-part replenishment strategy to get the best deal for taxpayers while increasing SPR stocks includes: (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. DOE has already secured cancellation of 140 million barrels of congressionally mandated sales scheduled for Fiscal Years 2024 through 2027. These cancellations have resulted in significant progress toward replenishment.

The SPR continues to be the world’s largest 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.

For more information on the SPR please visit Infographic: Strategic Petroleum Reserve and Fact Sheet: Strategic Petroleum Reserve.