The U.S. Strategic Petroleum Reserve (SPR) has fallen to its lowest point in 44 years, with the stockpile now at 286.6 million barrels, according to Department of Energy data released this week. This level represents approximately 40% of the reserve's total capacity.
The SPR's diminishing supply is occurring against the backdrop of a significant global energy shortage, which has contributed to rising U.S. gasoline prices exceeding $4 a gallon and has exacerbated inflation. Global oil prices have seen fluctuations, with benchmarks climbing above $92 a barrel recently following reports of an oil tanker being struck off the coast of Oman.
Established in 1975 in response to the energy crisis triggered by the 1970s Arab Oil Embargo, the SPR is designed to serve as an emergency source of oil to protect the U.S. from sudden supply disruptions. The reserve, stored in underground salt caverns along the Texas and Louisiana coastlines, can hold up to 714 million barrels.
The President has the authority to release oil from the reserve under specific conditions outlined in the Energy Policy and Conservation Act. These releases are intended to increase supply on the open market and, in theory, lower oil prices.
Following the outbreak of the Iran war in late February, the U.S. committed to releasing 172 million barrels from its reserve as part of a larger coordinated effort by the International Energy Agency (IEA). IEA member nations agreed to release a combined 400 million barrels, the largest such release in the agency's history. To date, the U.S. has released approximately 128 million barrels from the SPR since the conflict began, according to data from the U.S. Energy Information Administration.
Prior to the current conflict, the U.S. had utilized the SPR in emergency situations four times since its inception. Most recently, in March 2022, President Joe Biden authorized the release of 180 million barrels over six months in response to oil price spikes following Russia's invasion of Ukraine.