DOE: 45.2M Bbl in SPR Oil First for Middle East Disruption

SECAUCUS, NJ (DTN) – The Department of Energy has awarded eight U.S.-based trading entities contracts for the exchange of 45.22 million bbl of crude oil from the Strategic Petroleum Reserve. These awards represent the first phase of a plan to lend 172 million bbl to stabilize markets amid Middle East conflict.

In a statement issued Friday (3/20), the DOE identified the eight recipients as Shell Trading, Trafigura Trading, Marathon Petroleum, BP Products, Gunvor USA, Mercuria Energy, Vitol, and Energy Transfer. Shell will receive the largest volume at 16.2 million bbl, followed by Trafigura with 8.86 million bbl.

Marathon was awarded 7.7 million bbl, while BP received 5 million bbl. Other awards include Gunvor at 3.085 million bbl, Mercuria and Vitol at 2.0 million bbl, and Energy Transfer at 375,000 bbl.

Borrowers must return the crude along with a premium of 18% to 22% in additional oil. This mechanism is expected to eventually add nearly 10 million bbl to the reserve from this batch.

The current SPR stockpile of 415.4 million bbl would provide slightly more than four days of global supply, and covers about 26 days of domestic demand. Global demand is currently estimated at approximately 100 million bpd.