“US Government Seeks Three Million Barrels of Crude Oil to Replenish Strategic Petroleum Reserves”

Washington is looking for up to three million barrels of crude oil. This was announced by the US government on Monday May 15. The offers are to be submitted until the end of May and the acquisition must be finalized in mid-June, the US Department of Energy (DOE) said in a press release. Deliveries are scheduled for August.

Saudi Arabia and the United Arab Emirates increasingly buy Russian oil

The announcement comes less than a week after U.S. Energy Secretary Jennifer Granholm announced U.S. plans to begin rebuilding its Strategic Petroleum Reserves (SPRs) in the summer. .

Already in October, the president had indicated that the United States would buy crude on the market if prices fell into a range between 67 and 72 dollars. The price of a barrel of WTI oil, the American benchmark, fell below the symbolic bar of 70 dollars at the beginning of May, its lowest level since mid-December 2021. It was evolving around 71 dollars on Tuesday.

In search of black gold

It is all the more necessary for the United States to replenish its strategic reserves since the government drew, between September 2021 and January 2023, some 250 million barrels from these reserves, i.e. 40% of the total, in an attempt to relieve the price of black gold. So much so that they are currently posting their lowest level for almost 40 years (October 1983).

The barrel of oil falls below 70 dollars, the lowest for more than 16 months

But Joe Biden’s government decided last December to stop pumping from these reserves, which are stored in huge salt caves in Texas and Louisiana. He has even since undertaken to replenish them and had launched an initial call for tenders for three million barrels, which never came to fruition.

A long and complicated process

And for good reason, at the end of March, Jennifer Granholm had indicated that he was going to be « difficile » to begin this process this year, due to the need to carry out maintenance work on several sites. Another problem: the US Department of Energy is required by an old law passed in Congress in 2015 to put on sale an additional 26 million barrels from strategic reserves between April and June.

“We will be done in June and by then we will get going and look to buy” of crude on the market, finally explained the Secretary of Energy last week, during a hearing before the subcommittee of the House of Representatives dedicated to Energy, the climate and the security of the transport networks. of electricity. “We hope to be able to take advantage” the decline in oil prices, observed this year, after the surge of last year, added the minister.

Still, it will take time, as Jennifer Granholm already pointed out in March. “It will take a few years, because filling takes longer than pumping,” she had explained.

(With AFP)