(Bloomberg) – The Biden administration is seeking to halt sales of the congressionally mandated Strategic Petroleum Reserve so it can fill the emergency reserve, a move that could impact the release of 147 million barrels of oil raw.
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The Energy Department is seeking to cancel or delay congressionally mandated sales in fiscal years 2024 through 2027 so it can move forward with a White House plan to replenish the oil reserve when Crude prices will hit around $70 a barrel, an agency official said in the Senate. committee on Thursday. Congress ordered the sale of 147 million barrels of oil to pay for unrelated legislative initiatives during this period, including 35 million barrels in fiscal year 2024, according to data compiled by research firm ClearView Energy. Partners.
“It doesn’t make sense for us to release oil while we’re trying to fill the SPR,” Doug MacIntyre, deputy department director for the Office of Petroleum Reserves, said in testimony before the committee. energy and natural resources. “We cannot fill and release from the same site at the same time.”
Such a plan, which would require congressional approval, could be attached to a must-have government funding bill that could come together this month.
The Biden administration has said it wants to start buying oil to fill the SPR after a historic drawdown of 180 million barrels this year to drive down prices amid Russia’s invasion of Ukraine and a increase in demand at the end of the pandemic. Energy security adviser Amos Hochstein reiterated in a Bloomberg Television interview on Wednesday that the United States is looking for oil in the $70 range on “a consistent basis” for that to happen.
Separately, Chevron Corp. CEO Mike Wirth said Thursday that the Biden administration’s plan to fill the SPR to those levels is “not necessarily a wise move.”
Instead, Wirth said in remarks to the Economic Club of New York, the SPR should be replenished on a regular basis, to keep inventories at appropriate levels while limiting price risk.
The SPR, which has a capacity of about 700 million barrels, is currently at about 389 million barrels, according to Department of Energy data.
–With help from Kevin Crowley.
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