December 1, 2022 |
The White House is looking at another drawdown of the Strategic Petroleum Reserve, and Wyoming Senator John Barrasso is asking questions.
Joe Biden’s apparently unlimited support of Ukraine in the proxy war with Russia is driving up oil prices and lowering supply. Even European allies, facing heating shortages and rationing this winter, are questioning the wisdom of the U.S. war policy.
CNBC’s Kayla Tausche reported yesterday that the White House told her that it is weighing future SPR drawdowns in early 2023 if prices spike.
The proposal comes as a significant supply crunch of heating oil has hit the Northeast and driven prices to levels unbearable for many households. Last week, Reuters reported the White House was mulling over a plan to increase inventories in the Northeast Home Heating Oil Reserve.
Senator Barrasso says the drawdowns of the SRP are unprecedented and evidence of the DOE’s mismanagement of the national security asset.
Barrasso is the Republican leader of senate’s Energy and Natural Resources Committee. He and Commerce Committee Republican Leader Cathy McMorris Rodgers (R-WA) sent a letter to Department of Energy (DOE) Secretary Jennifer Granholm raising concerns about potential damage to the SRP from the historically large drawdowns.
In the pointed letter to the DOE secretary, the senators write, “you have overseen the largest SPR drawdown in history, selling more than 245 million barrels since President Biden’s first day in office. This has occurred as gas prices remain high and supply chain shortages continue to plague our economy. Instead of unleashing American energy production, you have depleted our strategic stockpile while failing to establish long-term plans for the optimal size, configuration, maintenance, and operational capabilities of the reserve.”
The senators express concern over how the drawdowns are possibly damaging the caverns and pipelines that store and transport the crude oil.
The SRP is stored at four sites on the Gulf of Mexico, each located near a major center of petrochemical refining and processing. Each site contains a series of artificial caverns created in salt domes below the surface.
Individual caverns within a site can be up to 3,300 feet below the surface. Average dimensions are 200 feet wide and 2,000 feet deep. The capacity of the caverns range from 6 to 37 million barrels. Almost $4 billion was spent on the facilities. The caverns were created by drilling down and then dissolving the salt with water.
The senators laid out a series of nine oversight questions, including a demand for studies and assessments pertaining to the structural integrity of the SPR infrastructure as related to the president’s unprecedented drawdowns.
Senators Barrasso and Rogers asked that the requested answers and documentations be provided no later than December 12, 2022.
