US emergency oil reserve falls to lowest level since 1983

The US Strategic Petroleum Reserve (SPR), the country’s emergency crude oil stockpile, has fallen to its lowest level in 43 years following large drawdowns aimed at easing supply pressure during the Iran war.

Federal energy data from the US Energy Information Administration (EIA) showed the reserve fell to 340.3 million barrels, the lowest level since July 1983, when the US was still building up its emergency stockpile.

The Strategic Petroleum Reserve is held in underground salt caverns along the US Gulf Coast and is designed to provide emergency crude supplies during severe market disruptions.

The latest drop came after a series of releases from the reserve in recent months. The US drew down 0.4 million barrels in March, 20.3 million barrels in April, 39.4 million barrels in May and 15.1 million barrels so far in June, according to federal data.

The EIA’s latest public weekly data had shown SPR crude stocks at 349.2 million barrels in the week ending June 5, down from 357.1 million barrels a week earlier.

The decline follows the Trump administration’s decision in March to authorize the release of 172 million barrels from the SPR as part of a coordinated International Energy Agency effort to stabilize energy markets after the Middle East conflict disrupted global oil supplies.

Washington said at the time that the US release was part of a broader 400 million-barrel coordinated move by IEA member countries involving crude oil and refined products.

The SPR played a key role in cushioning oil and gasoline markets during the conflict, when supply concerns pushed energy prices sharply higher and raised fears over shipments through the Strait of Hormuz, one of the world’s most important transit routes for oil and liquefied natural gas.

The reserve has now fallen below the low levels reached during the Biden administration, when large releases after Russia’s invasion of Ukraine drew criticism from Republicans, including Donald Trump, then a private citizen in between his first and second terms.

Congress has set a minimum SPR level of 252.4 million barrels, though the president can go below that threshold in an emergency. The reserve also needs to retain sufficient crude to maintain operational flexibility.

The SPR was established after the 1970s oil shocks to protect the US economy from major supply disruptions. It reached a record high of more than 726 million barrels in 2010, according to EIA historical data.