Republicans Aren’t Happy About the Current State of Oil Reserves

Republican lawmakers have asked the Government Accountability Office (GAO) to evaluate the Department of Energy’s (DOE) management of the Strategic Petroleum Reserve (SPR) after the Biden administration conducted record sales of 250 million barrels from the facility last year. 

Senator John Barrasso, ranking member of the Senate energy committee, and Representative Cathy McMorris Rodgers, head of the House energy committee, said that the sales have “undermined America’s energy security, leaving the nation more vulnerable to energy supply disruptions, and increasing the ability for OPEC and Russia to use energy as a geopolitical weapon.”

The SPR is a stockpile of crude oil maintained by the US government to provide emergency supplies in case of an energy crisis. The reserve has a capacity of 713.5 million barrels and was established after the 1973-74 oil embargo by the Organization of the Petroleum Exporting Countries (OPEC). The reserve has been drawn down four times since its inception, most recently in 2011 during the Libyan Civil War.

Last year, the Biden administration conducted a record sale of 180 million barrels of oil to combat high gasoline prices after Russia’s invasion of Ukraine. The SPR sales have pushed levels of the reserve to the lowest since 1983. 

The Biden administration downplayed concerns over damaging the SPR, saying that the the lab that monitors the sites has even noted that the record drawdown may extend the longevity of the underground storage caverns.

The DOE said in March that it will start replenishing the SPR later this year. The department will also wait until after the life extension work at two of the reserves’ four sites on the coasts of Louisiana and Texas is completed.

The lawmakers said they were concerned about delays and cost overruns in the SPR modernization program authorized by Congress in 2015. 

A DOE spokesperson said the department is committed to refilling the reserve “in a manner that will deliver the best value for American taxpayers and protect US national (and economic) security interests, while abiding by congressional mandates and undertaking necessary maintenance that is also part of good stewardship.”

The GAO will evaluate the DOE’s management of the reserve and audit its modernization program. The assessment is expected to provide insights into the Biden administration’s management of the SPR and its modernization program, which could impact the country’s energy security in the future.

Information for this story was found via Reuters, Twitter, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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