Strategic Petroleum Reserve

Contents: (1) History of the Strategic Petroleum Reserve (SPR): Establishment of the SPR; (2) The Drawdown Authorities: Proposals in the 111th Congress to Amend the Authorities; (3) Acquisition of Crude Oil for the SPR: Resumption of Fill (2009); Royalty-in-Kind Acquisition; (4) When Should the SPR Be Used?: The Debate Over the Years; Use of the SPR in the Persian Gulf War (1990); Hurricanes and Changes in the Market Dynamics (2005-2008); The Call for an SPR Drawdown: Summer 2008; (5) Establishment of a Regional Home Heating Oil Reserve.

The Strategic Petroleum Reserve (SPR) was created in 1975 to help protect the U.S. economy from oil supply disruptions and it currently holds about 700 million barrels of crude oil. The Energy Policy Act of 2005 required the Department of Energy to expand the Strategic Petroleum Reserve's maximum storage capacity to 1 billion barrels of crude oil. As the Department of Energy (DOE) begins to expand the SPR, past experiences can help inform future efforts to fill the reserve in the most cost-effective manner. Thus, this book will focus on the factors that experts recommend be considered when filling and using the SPR, to what extent the SPR can protect the U.S. economy from damage during oil supply disruptions and under what circumstances would an SPR larger than its current size be warranted. As part of this book, GAO developed oil supply disruption scenarios, used models to estimate potential economic harm, and convened 13 experts in conjunction with the National Academy of Sciences. This is an edited, excerpted and augmented edition of a GAO and U.S. Department of Energy publication.