Move FM Global News

WASHINGTON D.C.: According to Department of Energy data released this week, U.S. emergency crude oil stocks dropped by 8.4 million barrels last week to 434.1 million barrels, the lowest level since October 1984.

In the week ending 9th September, some 6.3 million barrels of sweet crude and 2 million barrels of sour crude were released from the Strategic Petroleum Reserve, which was the steepest draw since May.

To tackle rising fuel prices, which contributed to surging inflation, in March President Joe Biden announced a plan to release 1 million barrels per day from the Strategic Petroleum Reserve over six months.

In an interview with Reuters last week, Energy Secretary Jennifer Granholm said the Biden administration is considering further Strategic Petroleum Reserve releases after the current program ends in October.

Meanwhile, research analyst Paul Sankey said if benchmark oil futures continue to drop, the Biden administration is less likely to release barrels from the Strategic Petroleum Reserve after October.

Due to sales following Congressional mandates and Biden’s price initiative, US stocks also declined. The Biden administration said it believes the plan to begin after October would help boost domestic oil production.

The oil is sold to qualified oil companies through online auctions, and prices set using a five-day average bracketing the delivery date.