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The U.S. Department of Energy (DOE) is continuing its efforts to bolster the depleted Strategic Petroleum Reserve (SPR) with new oil purchases. Today, DOE’s Office of Petroleum Reserves announced a call for bids to supply up to 1.5 million barrels of oil to the Bayou Choctaw site in January 2025. An additional solicitation will follow on August 12, 2024, for another 2 million barrels destined for the Bryan Mound site, also for delivery in January 2025. This move is part of a strategic plan to replenish the SPR while taking advantage of favorable oil prices.
The DOE’s stated goal is to buy crude oil at or below $79 per barrel.
The replenishment strategy comes in the wake of the SPR’s critical role in stabilizing the market during global supply disruptions, notably the release of more than 180 million barrels of oil from the SPR starting in 2021, as gasoline prices remained high. The Department of Treasury claims that these releases, along with coordinated international efforts, helped reduce gasoline prices by up to 40 cents per gallon in 2022.
The deadlines for submitting bids are set for 11:00 a.m. Central Time on August 13, 2024, for the Bayou Choctaw site and August 20, 2024, for the Bryan Mound site.
The SPR currently houses 375 million barrels of crude oil—a figure that is 263 million barrels less than oil in the SPR at the beginning of President Jo Biden’s term in office. The SPR, capable of storing as many as 714 million barrels of crude oil, is kept in underground salt caverns at four sites in Texas and Louisiana and was designed to protect the economy and American livelihoods during oil shortages.
