High prices force US to cancel oil reserve refill plan

Oil tanks

The US administration will not move forward with its latest plan to refill the Strategic Petroleum Reserve, announced in mid-March, due to rising oil prices.

The US Department of Energy stated that it prioritizes taxpayers' interests in its decision not to purchase up to 3 million barrels of oil for the Strategic Petroleum Reserve site in Louisiana.

This decision follows a recent increase in oil prices, which pushed US crude above $85 for the first time since October.

The Biden administration had aimed to buy oil at $75 a barrel or less to replenish reserves, but it spent an average of $81 a barrel when it bought 2.8 million barrels in late March.

The Energy Department seeks to refill stocks after they reached their lowest levels in 40 years after withdrawing 180 million barrels due to the war in Ukraine. It currently holds about 363 million barrels, down from 600 million in 2022.