Bipartisan groups in Congress introduce bill to protect strategic petroleum reserve

(The Center Square) – A bipartisan group of U.S. senators introduced a bill to limit, not prohibit, the sale of crude oil from the U.S. Strategic Petroleum Reserve (SPR).

The Banning SPR Oil Exports to Foreign Adversaries Act was filed in the U.S. Senate by Sens. Ted Cruz, R-Texas, John Fetterman, D-Penn., and Elissa Slotkin, D-Mich. U.S. Reps. Chrissy Houlahan, D-Penn, Don Bacon, R-Nebraska, and Jay Obernolte, R-Calif. filed the bill in the U.S. House.

Instead of repealing provisions of a 10-year-old law to ban the sale or export of SPR oil, the bill seeks to amend the Energy Policy and Conservation Act to prohibit the sale or export of SPR oil to certain countries and entities. It would ban SPR oil from being sold or exported to the People’s Republic of China, North Korea, Russian Federation, Islamic Republic of Iran, any entity owned or controlled by these countries or the Chinese Communist Party.

The SPR is the largest publicly stored emergency supply of petroleum in the world – solely supplied by the U.S. oil industry, led by Texas. The SPR was created after a U.S. energy crisis erupted from a 1973 Organization of the Petroleum Exporting Countries (OPEC) oil embargo and Carter administration inflationary policies.

Underground tanks in Texas and Louisiana have the capacity to hold more than 700 million barrels of petroleum. Instead of passing balanced budgets, in 2015, Congress mandated that the U.S. Department of Energy sell SPR oil to fund its deficit spending.

Since then, the DOE has sold SPR reserves to the highest bidder through competitive public auctions to anyone in the world. During the Biden and Trump administrations, foreign companies with direct ties to American adversaries purchased SPR oil for anti-democratic regimes.

In 2022, in response to energy policies he implemented that directly contributed to high energy costs and inflation, President Joe Biden instructed the DOE to release 1 million barrels of SPR oil a day for 180 days. Chinese companies benefited from the sale, purchasing large quantities. The 2022 release was the largest SPR sale in U.S. history, according to US Energy Information Administration data.

Biden left the SPR with less than 395 million barrels of crude oil. Under the first Trump administration, the SPR exceeded 695 million barrels. Under the Obama administration, it exceeded 726 million barrels.

“The Strategic Petroleum Reserve is meant to protect the U.S. during crises, not supply our adversaries,” Cruz said. “Under President Biden, part of this reserve was sold, benefiting China’s strategic interests. There is strong bipartisan consensus around preventing such a sale from being repeated.”

“The Strategic Petroleum Reserve protects America’s energy, economic, and national security,” Fetterman said. “We must prioritize the safety of America and our allies – we cannot allow our adversaries to purchase oil from our critical energy reserves. This is a commonsense bill with strong bipartisan support.”

Their efforts follow a bipartisan initiative to protect the SPR that was incorporated in the Fiscal 2024 National Defense Authorization Act (NDAA).

Cruz and Houlahan introduced amendments to their respective chamber’s version of the NDAA, which included similar provisions to this bill. Cruz’s amendment received bipartisan support in the Senate. Houlahan’s amendment unanimously passed in the House.