The U.S. will begin repurchasing oil to refill the Strategic Petroleum Reserve when prices drop to around $70 per barrel and look to use the reserve aggressively to lower prices in the future, President Joe Biden’s top energy envoy said Tuesday.
“Somewhere around that range of $70, $72, $73 or maybe a little bit below that, we’ll look to immediately begin to increase and repurchase oil into the SPR,” U.S. energy envoy Amos Hochstein said Tuesday on CNBC’s Squawk Box.
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The comments from Hochstein, an official at the State Department, indicate a willingness to buy oil at the top of the range previously identified by the White House, which said last month it will buy back oil to refill the U.S. emergency crude stockpile when prices are in the $67 to $72 per barrel range or lower.
Prices for U.S.-based West Texas Intermediate have fallen to nearly $80 a barrel this week, although prices edged up Tuesday after Saudi Arabia signaled that OPEC+ could extend its production cuts through December.
Hochstein also said the Biden administration will be “opportunistic” about ordering more SPR releases, after Biden in March ordered the sale of 180 million barrels of oil from the SPR.
The drawdown — the largest and fastest in U.S. history — was an effort to alleviate soaring gas prices caused by Russia’s war in Ukraine, but also sent the reserves plummeting to their lowest level in 40 years.
“I don’t think there’s been much criticism today” for Biden’s decision to sell the 180 million barrels, Hochstein said on CNBC.
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Republicans, though, have criticized the sales as diminishing the U.S. ability to respond to major emergencies.
“The releases from the SPR are a critical part of bringing prices down when we did them. Just imagine if we had not increased supply by a million barrels a day,” he said.
