US taps into another batch of crude from SPR

The US Department of Energy (DOE) has issued an exchange of up to 400,000 bbls of crude oil from its Strategic Petroleum Reserves (SPR).

IMAGE: Oil storage facility. Getty Images

The DOE’s move comes in response to a temporary crude oil supply disruption affecting the Phillips 66 Lake Charles Refinery in Louisiana, it said.

The crude oil will originate from the SPR’s West Hackberry site in Louisiana and is available for immediate delivery, the DOE said, without specifying the cause of the delivery disruption.  

The exchange addresses a local refinery bottleneck before the US mid-term elections, rather than plugging broader global supply deficits.

“Under the terms of the exchange, all borrowed crude oil will be returned with additional premium barrels,” the US agency said.

Separately, the US DOE continues to rollout crude oil from its 172 million-bbl contribution to the International Energy Agency’s (IEA) coordinated 400 million-bbl release by 32 member countries, in a bid to stabilise global oil supplies amid the Middle East conflict.

In September, the DOE issued an exchange of up to 40 million bbls of crude oil from its Big Hill and Bryan Mound sites to oil companies including BP and ExxonMobil.

The US SPR fell to 282.7 million bbls in the week ending 16 October. This marked its lowest level since 1982, according to the US Energy Information Administration (EIA).

That is down from 283 million bbls the prior week and from 407 million bbls a year earlier.

The SPR fell below 300 million bbls in early August for the first time since 1983 and has hit a new low every week since.

By Aparupa Mazumder

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