The US Strategic Petroleum Reserve will see the drawdown of another 40.1 million barrels under the Biden administration's bid to sell 180 million barrels from the nation's oil reserve between May and October to bridge a supply that has led to record high fuel prices, the Department of Energy said on Tuesday
WASHINGTON (Pakistan Point News / Sputnik - 24th May, 2022) The US Strategic Petroleum Reserve will see the drawdown of another 40.1 million barrels under the Biden administration's bid to sell 180 million barrels from the nation's oil reserve between May and October to bridge a supply that has led to record high fuel prices, the Department of Energy said on Tuesday.
"(The) additional Notice of Sale of up to 40.1 million barrels of crude oil from the Strategic Petroleum Reserve (SPR) ... is part of President Biden's announcement on March 31, 2022, to release one million barrels of crude oil a day for six months," the Department of Energy said in a statement.
Half of the targeted release - or 90 million barrels - would be achieved by end-August, the release said.
Sour crude represents middle-of-the-barrel variety oil that has higher sulfur content and is more viscous than sweet crude. Sour crude is typically required for making the diesel needed for trucks, buses and trains, as well as the fuel for jets.
Sweet crude, on the other hand, has very little sulfur and resides at the upper-end of the barrel. It is almost exclusively used for making gasoline.
A dire shortage of crude oil exports due to the West's sanctions against Russia have led to record high prices of both diesel and gasoline in the United States. The closure of several refineries during the height of the coronavirus pandemic have reduced US oil refining capacity as well, compounding the problem.
To alleviate the tight supply situation, the Biden administration has been releasing oil from the SPR in stages since November. Between the end of February and April, the administration took an average of 3 million barrels out of the SPR every week to help meet domestic refiners' demand for crude.
Despite crude's drop from March highs of above $130, the retail price of gasoline has hit record highs of $5 per gallon at the pump in some parts of the United States while diesel has reached all-time peaks above $6. The increases have prompted Biden to accuse energy firms of price-gouging at the pump. The US president has also blamed his Russian counterpart Vladimir Putin and the Ukraine crisis for the 40-year highs in inflation, calling them "Putin's price hikes."