The US Energy Secretary, Chris Wright, has announced plans to seek up to $20bn to achieve President Donald Trump’s objective of refilling the nation’s Strategic Petroleum Reserve (SPR) to its full capacity.
This restoration, which could span several years, aims to bring the reserve holdings “just close to the top” for optimal operation, as stated by Wright during an interview in Louisiana.
Following the announcement, US crude futures saw a momentary peak at $67.68 a barrel in New York, as reported by Bloomberg.
President Trump has expressed his commitment to reinforcing conventional energy sources since his inaugural address in January, which includes enhancing domestic oil production and easing regulations.
The SPR, “the largest of its kind”, serves as a safeguard against crude supply disruptions.
Wright was quoted by the news agency as saying: “Ultimately, that is what it was built for – to have the maximum security for the American people.”
Established in response to the 1970s Arab oil embargo, the reserve can hold approximately 700 million barrels (mbbl).
Under the previous administration of President Joe Biden, the reserve’s stockpile significantly diminished due to soaring gasoline prices triggered by Russia’s invasion of Ukraine, with current levels at 395mbbl, based on Energy Department data.
To proceed with the replenishment, Congress must approve the necessary funding, which remains uncertain.
The Energy Department’s budget for purchases was exhausted after the Biden administration acquired around 60mbbl.
Wright disclosed that a specific funding request to Congress has not yet been made.
During Biden’s term, approximately 290mbbl were sold from the reserve, including emergency drawdowns and sales mandated by Congress for unrelated expenditures such as infrastructure repairs.
Wright indicated that these rapid drawdowns might have caused infrastructure issues due to the reserve’s age.
Wright was quoted by the news agency as saying: “Was there some damage from the rapid drawdowns? It appears that there was. So certainly some of the money we are going to spend is going to be maintenance.”
Also, In February, the US Department of Energy approved a loan guarantee to expand Calumet’s sustainable aviation fuel refinery in Montana, enabling production to rise from 140 million to 315 million gallons annually.
