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Feds to sell 14 million barrels from oil reserve

Feds to sell 14 million barrels from oil reserve thumbnail

The Department of Energy is preparing to sell 14 million barrels of crude oil from the nation’s Strategic Petroleum Reserve (SPR) beginning later this month.

The agency announced late Tuesday that it would draw down the stockpile to meet the requirements of two bills passed by Congress, including a healthcare bill and bipartisan budget legislation.

The 21st Century Cures Act, signed into law last year, requires the Energy Department to sell a total of 25 million barrels of crude oil from the SPR starting this year. Revenues from the sale will help fund the National Institutes of Health.

A budget deal reached in 2015 requires the federal government to sell about 58 million barrels over eight fiscal years, beginning in 2018.

The SPR, designed to be a backup supply of oil reserved for energy emergencies, contains about 678.9 million barrels of crude oil.Despite sell-off provisions in the healthcare and budget bills, lawmakers are often hesitant to draw down the reserve for economic and national security reasons.

In his budget, President Trump proposed selling off half the SPR to raise $16.5 billion in revenue by 2027, a plan that Senate Energy and Natural Resources Committee Chairwoman Lisa Murkowski (R-Alaska) simply called “crazy” in May.

the hill

30 Comments on "Feds to sell 14 million barrels from oil reserve"

  1. Antius on Wed, 16th Aug 2017 3:37 pm 

    Does seem a tad silly. I hope they wait until the price shock hits and don’t just sell it off at rock bottom energy prices.

  2. Go Speed Racer on Wed, 16th Aug 2017 5:28 pm 

    Bad ideas from the far left.
    They want us to run out of oil.
    Instead just keep all that oil in the reserve,

  3. Anonymouse on Wed, 16th Aug 2017 8:06 pm 

    I wonder how many hours of operation those 14 meg barrels of oil will buy this ‘NiH’? Shouldnt be hard to run those numbers and see how far it gets them. IF, and its a big IF, any proceeds actually get allocated in the manner this blurb suggests they might.

    O wait, the ‘National Institute of Health’, despite its health-careish name, does not actually provide end-user health care services to amerikans(duh). It is a research program, and its quite likely its real purpose, at least in part, is to subsidize amerikas for-profit bio-medical R&D corporations.

  4. rockman on Wed, 16th Aug 2017 9:01 pm 

    Sell it or don’t sell it: it has no meaningful impact either way. And given the huge deficit the US budget runs the funds from the sale aren’t really allocated to any budget item. One can say all the oil sale revenue is allocated to the NIH and it’s only words: one can just as easily say the entire NIH budget is borrowed monies.

    Either way it’s pure spin to suck the naive into a meaningless debate.

  5. Boat on Wed, 16th Aug 2017 9:41 pm 

    Antius on Wed, 16th Aug 2017 3:37 pm

    Glad your worried about the budget. But wait isn’t the world supposed to crash soon and your worried about budgets?

  6. GregT on Wed, 16th Aug 2017 11:07 pm 

    A big reason for the coming crash Boat, is people not worrying about budgetary constraint, but of course someone like you, who believes that it is fine to be mired in debt, wouldn’t have a clue about budgets.

  7. Theedrich on Thu, 17th Aug 2017 1:02 am 

    Arizona’s Senator BrainCancer wants war. Mr. BrainCancer, senior senator of his state, is chairman of the Senate Armed Services Committee, and loves bombing, killing, maiming others while feeling morally superior in doing so.  Once upon a time his body was occupied by a human being, but now it is directed by Monsieur Glioblastoma (Mr. BrainCancer’s real name), who wants genosuicide for all Whites.  Mssr. G. feels that the world should end with himself, and the best way to accomplish this is to have the U.S. provoke Russia, North Korea, and even China into thermonuclear conflict.

    Mssr. G. has even made friends with the nihilists of the Left in order to destroy the American presidency.  He calls it “reaching across the isle” in order to extirpate all White Americans, who are of course “racists,” a pejorative term invented by the media Yids to destroy Western civilization.  (The latter have many such terms with which to befuddle and sway the Jesus-was-a-Jew herd.)

    BrainCancer’s vision may indeed come to pass.  Through his influence, the U.S. Congress is passing feelgood sanction after feelgood sanction on “rogue regimes” that must at all costs be regime-changed.  Saudi Arabia, of course, is exempt from any such sanction, since it provides so much pay to play in American politics, to say nothing of its oil.

    Meanwhile, America continues as the world’s primary consumer of lethal narcotics, of which Congress wants ever more, since the transnational crime syndicates make sure to fill Congressional campaign coffers with well-laundered narco-contributions.  Good ol’ boy BrainCancer wants to build bridges, not walls, so that more Whites will die and be replaced by muds of every sort.  Call it “standing up to defy hate.”

    Yes, we owe a lot to Mssr. G.  And we wish him godspeed in his progress.

  8. Cloggie on Thu, 17th Aug 2017 3:19 am 

    McCain, this ultimate tool of the deep state, will get his wish honored, there is going to be WW3, that will completely overhaul the current geopolitical landscape. McCain should be careful with what to wish for, it could very well happen that the first shots will be fired by Eurasia, notably China, because everybody understands that the US are vulnerable.

    The war between the US media and the proxy of European America DJT continues:

    Yesterday a pastor in Chicago…

    … has demanded from deep stater Rahm Emmanuel that statues of George f* Washington should be removed. After all, he had slaves. So did Jefferson.

    The frontal attack against ALL expressions of white history could begin any minute now. This could be the event that will unhinge America. From then on the only thing that matters will be: “who gets what”.

    Nobody saw the fall of the Iron Curtain or the civil wars in Yugoslavia, Syria or Donbass coming, it happened anyway.

    The moment for the liberation of Europe from the ZOG-empire is near and scores are going to be settled. We in Western Europe are rapidly approaching a 1989 of our own.

    You don’t want to be Merkel in the coming years.

  9. Outcast_Searcher on Thu, 17th Aug 2017 6:07 am 

    The federal government is taking various “extraordinary measures” to keep government running until October or later, since as usual, the clowns on Capitol Hill are playing games with the debt ceiling.

    This SPR sale is just an example. And since the price of oil is now low (compared to the past decade), it’s likely bad timing.

    But this is what happens when the actions of our elected representitives become more about tactics (getting re-elected in the short term), instead of strategy — OR at least trying to do what is best for their constituents over time.

    It’s pretty pathetic. The type of behavior one would expect from, say, 5th graders instead of educated adults with the power to govern a huge complex country — but here we are.

    And since the electorate keeps putting such CLOWNS in office — we can only blame ourselves, if we’re honest.

  10. Davy on Thu, 17th Aug 2017 7:08 am 

    “This SPR sale is just an example. And since the price of oil is now low (compared to the past decade), it’s likely bad timing.”

    OS, you do realize this sale is likely for maintenance. They do have maintenance requirements and these are to be funded from the SPR. The debt ceiling likely as nothing to do with it but it sounds good.

  11. rockman on Thu, 17th Aug 2017 9:09 am 

    Davy – “…you do realize this sale is likely for maintenance”. Same shell game. The revenue will NOT go directly into the SPR maintenance budget. The revenues from sales authorized under section 403 will be deposited into the general fund of the U.S. Department of the Treasury.

    So again just a word game: a politician can say 100% of the sales revenue will go to SPR maintenance. Or 100% to the NIH. Or 100% to pay for the latest fighter jets purchased by the Navy. Or 100% to pay a small portion of the interest we deliver every year on our $19+ TRILLION of govt debt. Just words. One can just as honestly say all SPR maintenance will be paid for by monies raised by selling US bonds. Bonds that are constantly being refinanced and thus never be paid off.

    So if it makes someone feel good by thinking the SPR sales will fund their favorite govt program just post it here: it would be just as true as anything coming out of DC.

  12. Davy on Thu, 17th Aug 2017 9:47 am 

    Rock, you know the mechanics of the SPR. Will 25MIL BBLs cover multiyear maintnence of is that a far lower number?

  13. rockman on Thu, 17th Aug 2017 3:20 pm 

    Davy – Difficult to judge. The feds don’t like putting out too much detail. If the oil just sits there’s not a lot of maintenance other the inhibiting corrosion and keeping the seals on the pumps lubed. But there have been so major “what the f*ck went wrong” events:

    From 2011: “The government is preparing to sell $500 million worth of crude oil the U.S. has stockpiled for emergencies because of problems with the integrity of one of the underground caverns where it is stored. Energy Secretary Steven Chu defended the plan Wednesday amid concerns the sale of crude from the Strategic Petroleum Reserve would leave the U.S. more vulnerable to disruptions in the supply of Mideast oil.

    Chu said it was better for the government to cash in on the crude rather than risk it seeping out of a salt dome cavern in southeast Louisiana or chance an overflow of oil as it is moved to other brimming storage sites.”

    Notice they don’t give the name of the facility or how much leakage. At the same time the Rockman was actually drilling wells on the flank of the salt dome outside the storage area. We joked about the possibility of some of the oil leaking on to our acreage. It was the Bayou Choctaw SPR that holds 73.6 MMB in 6 caverns – 21.8 MMB sweet and 51.8 MMB sour. Rumor was they lost 5 to 10 million bbls. And I understood they were transferring most if not all the oil to other sites.

    Bottom like: I don’t think regular maintenance cost are their biggest problem. In fact I wouldn’t be shocked if the primary reason for the sale is to run away from leakage problems. As I pointed out with the sale revenue going into the Treasury’s general fund the amount is a gnat sitting on the ass of an 800lb pig. LOL.

  14. Anonymous on Thu, 17th Aug 2017 4:16 pm 

    Sludge buildup can be an issue in large crude tanks. Would imagine same for salt domes. There are also costs for just maintaining the pumping

  15. Makati1 on Thu, 17th Aug 2017 5:56 pm 

    America on self-destruct:
    “”Start Throwing Rocks”: Washington Post Op-Ed Calls For More Violence In The Streets”
    “Republican Senator Corker Calls For “Radical Change” In The White House”
    “‘Leftist’ Meltdowns Continue: Therapists Report Huge Spike In Patients Suffering From “President Trump Stress Disorder””
    “CNN’s Chris Cuomo: “Extreme Right Is The Number One Domestic Terror Threat In The U.S.””
    “Pelosi Demands “Reprehensible” Confederate Statues Be Removed From Capitol”
    “Defiant Trump Doubles Down, Defends “Beautiful” Confederate Statues”
    “Virginia Governor Changes Stance: Confederate Monuments “A Barrier To Progress””
    “Why Was This ‘Crowd Hire’ Company Recruiting $25 An Hour ‘Political Activists’ In Charlotte Last Week?”” Shades of Soros…lol

    And on and on as the slide into the 3rd world steepens.

  16. Cloggie on Thu, 17th Aug 2017 6:33 pm 

    And on and on as the slide into the 3rd world steepens.

    Make that slide into civil war with the sole purpose of moving away from the third world.

    The mobilization has begun:

    Weimerica-2017. Leni Riefenstahl could be proud of some videos, although these torch march ones are constantly being removed by the Youtube-ADL sensors.

    On my favorite German right-wing site “pi-news” (political incorrect news) and the #1 resistance site in Germany, centered around Pegida and the AFD, tonight there are 1300 reactions and counting to the events in Barcelona tonight, must be a record:

    I post a lot here. It is only a matter of time before the Merkel government falls. Let is fall and the entire stinking post-1945 West with it. Ex-chancellor Helmut Kohl received Viktor Orban in his private home, shortly before he died, to show his anger with the c* in Berlin. And this week ex-chancellor Gerhard Schroeder, the one who openly says that he “doesn’t like America, apart from Elvis”, has accepted a board-position at Russian oil giant Rosneft, which was another middle finger against Merkel.

    Next month there are elections in Germany. Perhaps related, but now Germany and France will deploy troops at the southern border of Libya to halt the fake-refugees there. Finally! They are shitting in their pants for their own populations and their anger.

    It is only a matter of time before in all minority white cities majors will begin to remove everything that refers to white culture, not just general Lee, but also Washington, Jefferson, because they had slaves. Btw, did Neil Armstrong had slaves? Mount Rushmore? Blow it up! Shakespeare? From the curriculum, too white.

    War is coming, both in America and in Europe , to bury the Marxist 20th century.

  17. Cloggie on Thu, 17th Aug 2017 6:47 pm 

    Illiterate Protesters took down the wrong

  18. Apneaman on Thu, 17th Aug 2017 11:05 pm 


    White Nationalists Are Flocking to Genetic Ancestry Tests, and They’re Not Liking What They Find
    Turns out their bloodlines aren’t as “pure” as they’re desperate to believe they are.

  19. Makati1 on Thu, 17th Aug 2017 11:18 pm 

    Ap,they don’t want to believe that those slaves didn’t get some white women or that their white masters didn’t spread some seed in the black women. NO ONE is pure in this age. No one. I guess genetics will have to be banned. LOL

  20. Apneaman on Thu, 17th Aug 2017 11:26 pm 


    Why Can’t White Supremacists Confront the Fact That the Source of Their Economic Problems Are White Economic Elites?
    Frustrated young white men are facing class divisions more than racial divides.

    Enjoying the American left wing tribal posts bashing American right wingers? Hell I can match you post for post with this American tribal politics that no relation to oil whatsoever.

    Like the political sites there are plenty of righ wing white supremacist sites to spew your monkey race and politics.

    clog, are you going to continue to make this site a platform for your white supremacist beliefs?

    How would you like 50 Alternet links, like the ones above, a day on here?

    How does all this supremacist shit relate to oil?

    Here’s how I would argue it – The reasons radical white supremacists have come out of the wood work and increased their numbers and boldness is because the world and their country is in the late stages of collapse. If they had opportunity and jobs like previous generations we would not be seeing any of these useful idiot young radicals, left or right. What’s at the root of collapse? Overshoot, including declining net energy of which oil makes up the lions share.

    See how easy that was? Feel free to use my argument clog.

  21. Apneaman on Thu, 17th Aug 2017 11:35 pm 

    Mak, I only posted that as a demonstration of the flip side of the tribal coin to clogs stupid fucking links. Like all those right wing sites Alternet sucks.

  22. Cloggie on Thu, 17th Aug 2017 11:37 pm 

    There is no such thing as “white supremacists”, only white seperatists, as America will soon find out. You see, we have robots and machines these days.

  23. Apneaman on Thu, 17th Aug 2017 11:39 pm 

    The Germans know a thing or two about nationalism and racism gone wild. Peak oil too.

    Summary of German Armed Forces Peak Oil Study

    “Looks like they predicted the election of Trump:

    “…people will experience a lowering of living standards due to an increase in unemployment and the cost of oil for their vehicles. Studies reveal that only continuous improvement of individual living conditions provide the basis for tolerant and open societies. Setbacks in economic growth can lead to an increase in the number of votes for extremist and nationalistic parties.”

    If you’re wondering about the silence from the U.S. government and media on peak oil, it’s probably because they’re afraid acknowledging it would cause stock markets to crash world-wide. Congress is certainly aware of the problem (see the senate and house hearings here)”

  24. Cloggie on Thu, 17th Aug 2017 11:54 pm 

    That’s an old obsolete 2012 German study, in the days I also believed in the significance of peak conventional oil.

    Wrote that post in the month I joined this site, after had closed shop.

  25. Apneaman on Fri, 18th Aug 2017 3:10 am 

    Old obsolete? Is that like potato spuds, or candy sweets?

  26. rockman on Fri, 18th Aug 2017 1:29 pm 

    Someone in Houston went to the source of the problem: they threw red paint on a statue of Christopher Columbus last night. After all: he started all this sh*t. LOL. Now the next question: how many statues of William Frederick “Buffalo Bill” Cody are there out west that should be removed. Or the statue of Custer at his birthplace in Ohio? I can’t imagine many Native Americans getting warm cozy feelings looking at them.

    I do like the idea of moving all the CSA statues to one area/park. Similar to how the Germans have maintained some of the concentration camps as museums. Along with the CSA statues they should include big photo spreads of the carnage inflicted on both sides. Photos of Andersonville could be the centerpiece.

    Similar to the sentiment of the Jewish phrase: “Never again.”

    BTW the Rockman don’t have a dog in this fight: all his ancestors were in Ireland or France at the time of the Civil War. Also explains why you don’t see pictures of Queen Elizabeth hanging on his walls. LOL.

  27. rockman on Fri, 18th Aug 2017 1:37 pm 

    Just realized: why are we talking about all this sh*t under this thread? The Rockman got caught up in the highjacking before he realized it. Folks should stop being so lazy and start threads on subjects they want to discuss instead of distracting from the brilliant comments the Rockman made about the SPR. LOL.

  28. Anonymous on Fri, 18th Aug 2017 7:36 pm 

    700 MM bbls of oil (nominal SPR full) is $35 billion, at $50/bbl. Time value of money even at a conservative 8% (for E&Ps, this is conservative) is $2.8 billion per year.

    There are also substantial ongoing maintenance costs and the whole system will need substantial capital put into it as it is getting quite old.

    A better system than the SPR is just to rely on the market. If we had WW2 all over again and needed the oil because all overseas was cut off (very unlikely), we could still get by for military needs using domestic production and forcing a lot of conservation on the general public.

    Given we have such a reasonable domestic backstop, it does not make sense to have an SPR. We are not Japan.

    The whole thing is just 1970s silliness. Remember synfuels and wage and price controls?

  29. rockman on Fri, 18th Aug 2017 10:52 pm 

    A – I fully agree. The SPR has never been more then a pacifier for our consumers allowing them a false sense of security.

  30. Davy on Sat, 19th Aug 2017 4:39 am 

    Maybe, but I think it is those who discount how bad things could get that underestimate how important any security is when SHTF. This is the story of moderns. We have an insatiable appetite for efficiency and yields. Preparing with sustainability and resilience is considered inefficient. I think now is not the time to be discarding the SPR. I would consider the Chinese some smart people. They do stupid things and greedy things but they are full of good decisions. They are SPR proponents. Their economy has different dynamics but they realize a buffer when the see one.

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