The U.S. emergency crude oil stockpile fell by 4.6 million barrels last week to its lowest level since May 1985, according to the Department of Energy on Monday.
Crude held in the Strategic Petroleum Reserve (SPR) dropped to 469.9 million barrels for the week ended July 29, according to DOE data, in the smallest weekly withdrawal since May. All the barrels sold during the week were sour crude oil.
U.S. President Joe Biden in March set a plan to release 1 million barrels per day (bpd) over six months from the SPR to tackle high fuel prices that have contributed to soaring inflation.
U.S. gasoline prices are about 40 cents a gallon lower than what they would have been without the sales, the White House said last week https://www.whitehouse.gov/briefing-room/statements-releases/2022/07/26/fact-sheet-department-of-energy-releases-new-notice-of-sale-as-gasoline-prices-continue-to-fall.
Since May, releases have averaged 880,000 bpd. The oil is sold to accredited oil companies via online auctions.
The DOE did not immediately respond to a request for a comment.
The DOE has proposed a rule to return crude to the SPR by allowing it to enter contracts to purchase oil in future years at fixed, preset prices. The administration believes the plan will help boost domestic oil production, it said.
Refiner Valero Energy's Chief Commercial Officer Gary Simmons last week said he expects lower volumes to be released from the SPR in the future, as demand forecasts have been lowered, adding that oil markets were fairly well balanced.
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