OPINION: As the Biden administration plans to release an unprecedented 180 million barrels of oil from the Strategic Petroleum Reserve, Scott L. Montgomery walks you through the history of the U.S. emergency oil stockpile.
The Biden administration said Thursday it plans to release an unprecedented 180 million barrels of oil from the U.S. Strategic Petroleum Reserve to combat the recent spike in gas RB00, +0.06% and diesel prices . About a million barrels of oil will be released every day for up to six months.
Origins of the reserve Congress created the Strategic Petroleum Reserve as part of the Energy Policy and Conservation Act of 1975 in response to a global oil crisis. Salt domes, formed when a mass of salt is forced upward, are a good choice for storage since salt is impermeable and has low solubility in crude oil. Most of the storage sites were acquired by the federal government in 1977 and became fully operational in the 1980s.
There have only been three emergency releases in the reserve’s history. The first was in 1991 after Iraq invaded Kuwait the year before, which resulted in a sharp drop in oil supply to the world market. The U.S. released 34 million barrels. President Joe Biden’s November decision to tap the reserve was also seen as political by Republicans because there was no emergency shortage of supply at that time.
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