U.S. Strategic Petroleum Reserve Falls to Lowest Level Since 1983

The Department of Energy reported Monday that the Strategic Petroleum Reserve stood at 343 million barrels as of June 12, down nearly 9 million barrels from the previous week. The figure marks the lowest level recorded since the summer of 1983.

The administration announced in March a plan to release 172 million barrels over 120 days as part of a coordinated 400-million-barrel release agreed by International Energy Agency members. The releases were intended to offset supply shortfalls linked to the Iran conflict. A deal between the U.S. and Iran is scheduled for signing on Friday to reopen the Strait of Hormuz.

The U.S. established the reserve in 1975 following an oil embargo that triggered an energy crisis. Earlier draws occurred in 2022 after oil prices rose following Russia's invasion of Ukraine. The SPR previously reached a low of around 346 million barrels in July 2023.

U.S. consumption averages about 21 million barrels per day. Exxon senior vice president Neil Chapman stated on May 28 that prices could spike as summer fuel demand peaks. Tom Kloza, chief oil analyst at Gulf Oil, said he is not particularly worried about the current reserve level.

Bob McNally, president of Rapidan Energy, said inventories will continue to decline even after the deal is implemented. "We still have inventory draws. Those are inexorable and they're already at historic lows," McNally said.