Status of Strategic Petroleum Reserve Activities

Title VIII of the Energy Security Act requires the President to resume filling the Strategic Petroleum Reserve (SPR) at an average rate of at least 100,000 barrels per day for fiscal year 1981 and succeeding years. It also requires the President to amend the Department of Energy (DOE) entitlement regulations so that the Government, in effect, pays lower tier prices for SPR crude oil.

The administration has had only partial success in its SPR oil acquisition efforts. The Defense Fuel Supply Center awarded contracts for a total of about 24 million barrels of crude oil to be delivered to the SPR in exchange for an identical amount of oil recieved from the Naval Petroleum Reserve, plus cash premiums. As of October 15, 1980, about 3.1 million barrels of oil were added, bringing the total to about 94.3 million barrels in the SPR storage. DOE and companies receiving the initial awards tentatively agreed that almost 65 percent of the 24 million barrels would be delivered by January 1, 1980. About $300 million of fiscal year 1980 funds for oil purchase have not been obligated, and obligation authority will expire on December 31, 1980. DOE continues to direct most of its attention to meeting the minimum supply requirement for the SPR, and has taken no action to acquire oil above the initial 100,000-barrel-per-day minimum.