Latest Release Pushes SPR Stocks to Lowest Levels in More Than 40 Years

The U.S. released 8.9 million bbl of crude from the Strategic Petroleum Reserve last week, sending stockpiles to their lowest levels in more than four decades, according to Department of Energy data Monday.

There are now 340.3 million bbl in the stockpile. That’s down 75.14 million bbl from the recent high of 415.422 million bbl the reserve held in March, before the Trump administration began a release program. The program is in an effort to deal with supply disruptions after Iran closed the Strait of Hormuz, a chokepoint for about 20% of global oil supplies.

Supplies in the reserve are now the lowest they have been since July 1983, when the stockpile held 339.96 million bbl, DOE data show.

Supplies are likely to continue falling as the administration has pledged to release a total of 172 million bbl from the reserve under a return/exchange program. Under the program, oil is loaned to companies. The companies are required to return the oil by next year, along with additional barrels as a premium for the exchange, the Department of Energy has said.

Last week, the administration advertised for bids for up to 40 million bbl from the reserve. If all those barrels are awarded, the administration will have awarded contracts for the full amount of oil under the current program.

There are now 128.3 million bbl of sweet crude held in the reserve and 211.9 million bbl of sour crude. Last week’s release included about 4.9 million bbl of sweet crude and about 4.1 million bbl of sour crude, the department’s data show.

The ongoing releases from the reserve, as well a strong export demand, have pressured U.S. crude oil inventories in recent weeks, with total supplies in the week ending June 5 at the lowest level since October 2023, Energy Information Administration data show.

While oil futures prices are falling following the announcement of a deal to end the fighting between the U.S. and Iran and reopen the strait, analysts have warned that the need to replace stockpiles depleted during the fighting could support crude prices in the near term.

Reporting by Steve Cronin, scronin@opisnet.com; Editing by Michael Kelly, mkelly@opisnet.com