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High Oil Prices Force Biden Admin to Halt SPR Refill Plans

By Robert Rapier - May 03, 2024

Despite indicating they would refill the Strategic Petroleum Reserve (SPR) by the end of this year, the Department of Energy has now canceled solicitations offered last month.

Citing rising oil prices, the DOE said, “We will not award the current solicitations for the Bayou Choctaw SPR site and will solicit available capacity as market conditions allow.” Three million barrels of oil had been slated for delivery to the Bayou Choctaw SPR site in August and September.
The SPR is the world’s largest supply of emergency crude oil. It was established primarily to reduce the impact of disruptions in supplies of petroleum products and to carry out obligations of the United States under the international energy program.

The SPR is maintained by the U.S. DOE and its oil stocks are stored in huge underground salt caverns at four sites along the coastline of the Gulf of Mexico. The size of the SPR (authorized storage capacity of 714 million barrels) makes it a significant deterrent to oil import cutoffs and a key tool in foreign policy.

Following Russia’s invasion of Ukraine, the Biden Administration made the largest withdrawal in SPR history to curb the oil price spikes that happened in the wake of the invasion. The DOE has consistently promised to refill the SPR as market conditions allow.
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The total number of active drilling rigs for oil and gas in the United States fell this week, according to new data that Baker Hughes published on Friday.

Jun 07, 2024,

The total rig count fell by 6 to 594 this week, compared to 695 rigs this same time last year.
The number of oil rigs fell by 4 this week, after staying the same in the week prior. Oil rigs now stand at 492--down by 64 compared to this time last year. The number of gas rigs fell by 2 this week to 98, a loss of 37 active gas rigs from this time last year. Miscellaneous rigs stayed the same at 4.

Meanwhile, U.S. crude oil production stayed the same for the twelfth week in a row at an average of 13.1 million bpd for the week ending May 31—down 200,000 bpd from the all-time high of 13.3 million bpd.

U.S. Oil, Gas Drilling Activity Sees Further Declines

By Julianne Geiger - Jun 14, 2024

The total number of active drilling rigs for oil and gas in the United States fell this week, according to new data that Baker Hughes published on Friday.

The total rig count fell by 4 to 590 this week, compared to 687 rigs this same time last year.
The number of oil rigs fell by 4 again this week, after falling by 4 in the week prior. Oil rigs now stand at 488--down by 64 compared to this time last year. The number of gas rigs stayed the same this week at 98, a loss of 32 active gas rigs from this time last year. Miscellaneous rigs stayed the same at 4.

Meanwhile, U.S. crude oil production broke its 12-week 13.1 million bpd streak for week ending June 07, rising by 100,000 bpd to an average of 13.2 million bpd. Current weekly production in the United States, according to the EIA, is now down down 100,000 bpd from the all-time high of 13.3 million bpd.