- The agency said in the statement that the U.S. had also arranged to replace these strategic reserves with about 200 million barrels within the next year.
- This would be about 20% more than will be drawn down, without any burden on taxpayers, as per the department.
- President Trump’s move to release oil from the SPR demonstrates his commitment to protecting America’s energy security, the agency added.
The United States will release 172 million barrels of oil from the Strategic Petroleum Reserve, starting next week, the U.S. Department of Energy said on Wednesday.
As per a statement from the agency, the U.S. Secretary of Energy Chris Wright has said that after 32 member nations of the International Energy Agency (IEA) agreed to President Trump’s request to lower energy prices with a release of 400 million barrels of oil and products from their respective reserves, the president had granted the release of the oil from the American reserves.
The release is expected to take about 120 days to deliver based on planned discharge rates, as per the agency.
The move comes amid rising oil prices that have hit almost $120 per barrel in recent times after supply constraints due to the blockade of the Strait of Hormuz in the ongoing war with Iran. WTI crude was trading around $90.98 at the time of writing.
America-First Move
The agency said in the statement that the U.S. had also arranged to replace these strategic reserves with about 200 million barrels within the next year, about 20% more than will be drawn down, without any burden on taxpayers.
President Trump’s move to release oil from the SPR demonstrates his commitment to protecting America’s energy security, the agency added.
“Rest assured, America’s energy security is as strong as ever," the statement said.
Market Reaction
Meanwhile, despite the emergency reserves released from both the U.S. and the IEA, oil prices climbed higher on Wednesday. WTI Crude prices were at $92.54 per barrel, up more than 6%. Meanwhile, ICE Brent Crude was trading around $91.98 per barrel.
Earlier, Iran had reportedly said that the world should be prepared for oil to top $200 a barrel.
The United States Oil Fund (USO), which tracks WTI crude oil, surged 6.75% in after-hours.
Meanwhile, U.S. equities were in red in Wednesday’s after-hours trading. At the time of writing, the SPDR S&P 500 ETF (SPY), which tracks the S&P 500 index, was down by 0.88%, the Invesco QQQ Trust ETF (QQQ) declined 0.88%, while the SPDR Dow Jones Industrial Average ETF Trust (DIA) fell 0.97%.
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