Back To The Bakken -- July 25, 2024

Locator: 48232OPEC. 

OPEC's oil reserves: lower than officially reported. Rystad Energy.

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Back to the Bakken

WTI: $78.23.

Friday, July 26, 2024: 44 for the month; 44 for the quarter, 370 for the year
40415, conf, CLR, Chase 6-19HSL,
40321, conf, Whiting, Sanish Bay E Federal 5292 22-7 8B,

Thursday, July 25, 2024: 42 for the month; 42 for the quarter, 368 for the year
40271, conf, CLR, Sloan 3-18HSL,
40173, conf, Slawson, Cyclone 2-21-16H,

RBN Energy: three-pronged plan to refill SPR comes with challenges beyond price. Archived.

The Biden administration has been on a mission for more than a year to restock the Strategic Petroleum Reserve (SPR), which was tapped at unprecedented levels in an effort to keep crude oil and refined product prices under control after Russia’s invasion of Ukraine in early 2022 disrupted energy flows globally. But if returning all of the released 180 MMbbl and replenishing the SPR to pre-war levels was the plan, they’ve got a long way to go. In today’s RBN blog, we examine the steps the administration has taken to replenish the reserve and the headwinds it faces.

The SPR is the largest emergency crude stockpile in the world. It was first proposed in the 1940s, but not established until 1975 and the first barrels weren’t added until 1977, four years after Arab members of producer cartel OPEC cut off oil flows to the U.S. after it provided aid to Israel during the Yom Kippur War. At that point, the U.S. was heavily dependent on Middle East crude for use at domestic refineries. (Many still remember idling in their cars in long lines at gas stations in hopes of getting a few gallons). The reserve was aimed at bolstering energy security and meeting the nation’s pledges with the then three-year-old International Energy Agency (IEA). According to a 1974 agreement, IEA members must hold stocks equivalent to at least 90 days of net oil imports, based on the previous year’s annual average. U.S. net imports averaged 2.42 MMb/d in 2023, so the total required in storage would be 217.8 MMbbl, or 58% of the SPR’s current inventory (more on that in a bit).