US Says Oil From Strategic Reserve Sale Could Hit Market as Early as January- Energy Dept.
00:43 GMT 14.01.2022 (Updated: 13:27 GMT 06.08.2022)
WASHINGTON (Sputnik) - Oil from the US government’s Strategic Petroleum Reserve (SPR) sale could hit the market as early as January after 18 million barrels were initially contracted to be sold to six energy firms under the program aimed at reducing prices of fuel at the pump, the Department of Energy (DOE) said on Thursday.
“On December 17, 2021, DOE issued a Notice of Sale for a price-competitive sale of 18 million barrels of SPR crude oil,” the Energy Department said in a statement. “It said 14 companies responded and six were initially picked. “The SPR plans to schedule deliveries between February 1 - March 31, 2022, with early deliveries available in January if arrangements can be made.”
The winners then and the allocations given to them were ExxonMobil Oil Corp, (500,000 barrels); Gunvor USA LLC (1.5 million barrels); Marathon Petroleum Supply and Trading LLC (3.9 million barrels); Motiva Enterprises LLC (3 million barrels); Phillips 66 Company (1 million barrels); and Valero Marketing and Supply Company (8.2 million barrels).
More companies have since entered into deals with the Department of Energy and allocations have changed too.
Shell Trading Company, one of those not on the original list, has taken 870,000 barrels, the Department of Energy said in a statement issued on Wednesday. ExxonMobil has also transacted 6.8 million barrels compared to the initial 500,000 announced by the Department of Energy.
12 January 2022, 22:54 GMT
Companies that receive Strategic Petroleum Reserve crude oil through the exchange agree to return the amount of crude oil received, as well as an additional amount, dependent upon the length of time in which they hold the oil, the Department of Energy said.
The Biden administration has said it hopes to reduce the amount of crude oil that petroleum refiners buy directly from the open market in order to cap prices for both the raw material and the fuel sold at pumps.
Prices of crude oil and fuel at US pumps hit their highest this year since 2014 as global oil exporters under the OPEC+ alliance cut output despite higher demand for energy in a world recovering from the effects of the coronavirus pandemic measures.