Oil prices jumped on Wednesday…
Regulations and constraints on land…
Two Republican legislators have called for an evaluation of the Department of Energy’s management of the Strategic Petroleum Reserve (SPR) and an audit of its modernization program. The calls come in the wake of the largest withdrawal from the reserve by the federal government.
According to them, the withdrawal has undermined the country’s national security and increased U.S. reliance on foreign energy.
“DOE’s mismanagement of the SPR has undermined America’s energy security, leaving the nation more vulnerable to energy supply disruptions, and increasing the ability for OPEC and Russia to use energy as a geopolitical weapon,” House Energy and Commerce Committee Chair Cathy McMorris Rodgers and Senate Energy and Natural Resources Committee Ranking Member John Barasso wrote in a letter to the Government Accountability Office.
This is not the first time the two Republican legislators have sounded the alarm about the state of the SPR. Last year, they wrote to Energy Secretary Jennifer Granholm, warning that SPR withdrawals from last year led to a "rapid depletion of the SPR” that “may have caused damage to SPR's pipelines and caverns, compromising its ability to meet its energy security mission in the event of a true energy supply interruption."
The Energy Department dismissed the concern, with an official stating that the SPR storage and pipeline infrastructure was being monitored and the reserve was operational and ready to be deployed in case of emergency.
Last year, the Biden administration released a total of more than 220 million barrels from the system to counter rising retail fuel prices. Plans were to start replenishing the SPR as soon as prices fell to between $67 and $72 per barrel but when price did fell to these levels, the administration deflected, indicating it was in no rush to start buying.
Now, WTI is once again within the stated range of the White House but there is no talk of replenishment. According to a Department of Energy official who spoke to Reuters, the administration will replenish the SPR "in a manner that will deliver the best value for American taxpayers and protect U.S. national (and economic) security interests, while abiding by congressional mandates and undertaking necessary maintenance that is also part of good stewardship."
By Irina Slav for Oilprice.com
More Top Reads From Oilprice.com:
Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.