The US Energy Department announced Friday a plan to add oil back to the Strategic Petroleum Reserve (SPR) after a historically large release undertaken by the Biden administration.
The policy marks a significant shift after President Biden authorized the biggest-ever release earlier this year following Russia’s invasion of Ukraine, which sent oil prices to $120 a barrel.
The plan represents “an opportunity to secure a good deal for American taxpayers by repurchasing oil at a lower price than the $96 per barrel average price it was sold for, as well as to strengthen energy security,” the Department of Energy (DOE) said in a news release.
The agency said it will buy up to three million barrels of oil under a pilot program designed to attract sellers who can lock in prices.
The SPR currently holds 382 million barrels of crude, down some 216 million barrels from its level before September 2021.
A Biden official said in October that the administration planned to purchase oil to refill the reserve as soon as prices hit around $67-72 a barrel.
Crude prices have fallen significantly from their peak levels earlier in the year. On Friday, US benchmark West Texas Intermedia dropped 2.4 percent to $74.29 a barrel.
The DOE announcement noted that gasoline prices have dropped by more than $1.80 a gallon from their June 2022 apex and now stand at the cheapest level since September 2021.
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