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Quick Context: SPR Refill—Take Two
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Quick Context: SPR Refill—Take Two

Washington is back in the crude-buying game with a plan to purchase 3 MMbbl for August delivery; latest solicitation boasts improvements over December attempt but concerns remain re: pricing details.

Rory Johnston's avatar
Rory Johnston
May 16, 2023
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Quick Context: SPR Refill—Take Two
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This is an event-driven Quick Context report and builds on the past year of ongoing Commodity Context research related to the US Strategic Petroleum Reserve—see below for a list of that research.

Become a paid subscriber today to view this full Quick Context report on the latest SPR developments and join me in my hunt for ever-deeper oil & gas market context.

If you’re already subscribed and/or appreciate the free summary, hitting the LIKE button is one of the best ways to support my ongoing research.


US Strategic Petroleum Reserve purchase landing page, accessible here

  • The US federal government is back on the crude-buying wagon, announcing a new solicitation aimed at refilling the SPR with 3 million barrels of sour crude for delivery in August, with offers due by the end of May.

  • This solicitation follows a first, ultimately unsuccessful, attempt to begin rebuying barrels for the SPR in December, and the Biden administration is hoping to leverage some of its lessons learned.

  • My take: there are some good (e.g., pricing differentials) as well as bad (e.g., domestic crude only) details contained in the solicitation; still, the very fact that the effort is being made highlights that the administration remains focused on, though I remain concerned that potentially problematic contract details could prompt another round of challenging offers.

Yesterday afternoon, the US Department of Energy (DOE) announced that it is looking to purchase 3 million barrels of sour crude to begin refilling the Strategic Petroleum Reserve (SPR). Offers are due by May 31st and delivery scheduled for August—you can read the full details of the DOE’s solicitation here. 

This Quick Context serves up an immediate, midweek take on the announcement: the good, the bad, and what it says about the Biden Administration’s commitment to its previously enunciated strategic pivot toward a more active SPR. For additional context on this most recent SPR-related development, readers should check out my previous research on the topic, including on the initial emergency release; the announcement of new flexibility to refill the reserve; why strategic reserves are different from commercial inventories in the eyes of the market; and, most recently, on the administration’s first attempted and ultimately unsuccessful solicitation in December.

Now, let’s dig into the news.

Devil in the Refill Details

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