The Trump administration is set to purchase 1 million barrels of crude oil for the U.S. Strategic Petroleum Reserve, capitalizing on low oil prices to replenish the currently diminished stockpile. The Energy Department is expected to announce on Tuesday its intentions to solicit oil deliveries for December and January. This initiative will utilize a portion of the $171 million allocated by President Donald Trump’s tax and spending legislation, according to an agency official.
West Texas Intermediate, a key benchmark for U.S. oil prices, has decreased by approximately 30% since reaching its peak in mid-January, trading around $58 per barrel on Tuesday, marking its lowest price since 2021.
Former President Trump has pledged to refill the Strategic Petroleum Reserve, which has a maximum capacity of roughly 700 million barrels. Currently, the reserve holds about 408 million barrels, but the administration faces budget constraints regarding further purchases.
The reserve levels were significantly impacted during President Joe Biden’s administration when rising gasoline prices followed Russia’s invasion of Ukraine. In 2022, the release of approximately 180 million barrels cost around $280 million and postponed necessary maintenance, as reported by the Energy Department.
Bids for the Energy Department’s solicitation for 1 million barrels, designated for delivery to the Bayou Choctaw facility, must be submitted by 11:00 a.m. CT on October 28. The procurement will be executed through a spot-price-indexed contract.
