tag:theconversation.com,2011:/us/topics/strategic-petroleum-reserve-19562/articlesStrategic Petroleum Reserve – The Conversation2023-03-16T20:04:51Ztag:theconversation.com,2011:article/2019352023-03-16T20:04:51Z2023-03-16T20:04:51Z3 reasons the Willow Arctic oil drilling project was approved – it’s the latest battle in a long fight over Alaska’s North Slope<figure><img src="https://images.theconversation.com/files/515657/original/file-20230316-3305-49vbkg.jpg?ixlib=rb-1.1.0&rect=0%2C15%2C2043%2C1271&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Several oil projects are active in the National Petroleum Reserve-Alaska. </span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/blmalaska/20172203409">Bob Wick/Bureau of Land Management</a>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span></figcaption></figure><p>For more than six decades, Alaska’s North Slope has been a focus of intense controversy over oil development and wilderness protection, with no end in sight. Willow field, a 600-million-barrel, US$8 billion oil project recently <a href="https://www.npr.org/2023/03/13/1163075377/willow-drilling-project-alaska-approved-biden">approved by the Biden administration</a> – <a href="https://www.arctictoday.com/conocophillips-alaska-willow-project-approvals-hit-with-second-lawsuit/">to the outrage</a> of environmental and climate activists – is the latest chapter in that long saga. </p>
<p>To understand why President Joe Biden allowed the project, despite vowing “<a href="https://www.youtube.com/watch?v=iLUcpYEYk48">no more drilling on federal lands, period</a>” during his campaign for president, some historical background is necessary, along with a closer look at the ways domestic and international fears are complicating any decision for or against future oil development on the North Slope.</p>
<h2>More than just Willow</h2>
<p>The Willow project lies within a vast, 23 million-acre area known as the <a href="https://www.blm.gov/programs/energy-and-minerals/oil-and-gas/about/alaska/NPR-A">National Petroleum Reserve-Alaska</a>, or NPR-A. This was one of four such reserves set aside in the early 1900s to guarantee a supply of oil for the U.S. military. Though no production existed at the time in NPR-A, geologic information and surface seeps of oil <a href="https://pubs.usgs.gov/fs/fs024-01/fs024-01.pdf">suggested large resources</a> across the North Slope.</p>
<p>Proof came with the 1968 discovery of the supergiant <a href="https://petrowiki.spe.org/Prudhoe_Bay_field">Prudhoe Bay field</a>, which began producing oil in 1977. Exploratory programs in the NPR-A, however, found only small oil accumulations worthy of local uses.</p>
<p>Then, in the 2000s, new <a href="https://www.rigzone.com/news/oil_gas/a/151488/a_second_wind_for_the_north_slope/">geologic understanding and advanced exploration technology</a> led companies to lease portions of the reserve, and they soon made large fossil fuel discoveries. Because NPR-A is federal land, government approval is required for any development. To date, most have been approved. Willow is the latest.</p>
<figure class="align-center ">
<img alt="Two caribou stand on grasslands." src="https://images.theconversation.com/files/515656/original/file-20230316-3073-bd566q.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/515656/original/file-20230316-3073-bd566q.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=402&fit=crop&dpr=1 600w, https://images.theconversation.com/files/515656/original/file-20230316-3073-bd566q.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=402&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/515656/original/file-20230316-3073-bd566q.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=402&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/515656/original/file-20230316-3073-bd566q.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=505&fit=crop&dpr=1 754w, https://images.theconversation.com/files/515656/original/file-20230316-3073-bd566q.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=505&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/515656/original/file-20230316-3073-bd566q.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=505&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Caribou in the National Petroleum Reserve-Alaska are important for Native groups. However, Native communities have also been split over support for drilling, which can bring income.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/mypubliclands/18725729354/in/photolist-uwJfWE-uwJfSm-vcakTj-cM6sVw-U8eUJo-jsHpAR-uwTVhi-AE46zU-cM6cAf-vu5S3t-2hU2K1G-cM6uZo-cLWp3m-cM65Eo-cM6cp5-cM6tFA-cM6vqd-cM6xgL-cM6iFN-cM6znN-cM6wEE-cM5ZkC-cM5ZKh-cM66FY-25tq5XQ-cM6eNL-cM61yo-cM6fHY-pQUqJ2-cM6x8W-cM6iw5-cM6e1L-cM6uoo-cM6iMw-cM6wW7-cM61RU-cM6fZC-cM6vfW-cM6ktA-cM64ss-cM6j5J-cM6cvG-cM6yJA-cM6nDA-cM6tQE-cM6jFq-cM6cXC-cM671j-cM666h-cM5ZAE">Bob Wick/Bureau of Land Management</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span>
</figcaption>
</figure>
<p>Opposition to North Slope drilling from conservationists, environmental organizations and some Native communities, mainly in support of wilderness preservation, has been fierce <a href="https://www.pbs.org/wgbh/americanexperience/features/pipeline-environmental-movement-and-oil-industry/%22%22">since the opening of Prudhoe Bay</a> and the construction of the Trans-Alaska Pipeline in the 1970s. In the wake of 1970s oil crises, opponents failed to stop development. </p>
<p>During the next four decades, <a href="https://theconversation.com/why-americans-will-never-agree-on-oil-drilling-in-the-arctic-national-wildlife-refuge-88992">controversy shifted east to the Arctic National Wildlife Refuge</a>. Republican presidents and congressional leaders repeatedly attempted to open the refuge to drilling but were consistently stifled – until 2017. That year, the Trump administration opened it to leasing. Ironically, no companies were interested. Oil prices had fallen, risk was high and the reputational cost was large.</p>
<p>To the west of the refuge, however, a series of new discoveries in NPR-A and adjacent state lands were drawing attention as a major new oil play with multibillion-barrel potential. Oil prices had risen, and though they fell again in 2020, they have been mostly above $70 per barrel – high enough to encourage significant new development.</p>
<figure class="align-center ">
<img alt="Map of northern Alaska showing NPRA in the west and ANWR in the eastern part. The Willow area is in the northeast corner of the NPRA." src="https://images.theconversation.com/files/515925/original/file-20230316-18-r21apr.gif?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/515925/original/file-20230316-18-r21apr.gif?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=237&fit=crop&dpr=1 600w, https://images.theconversation.com/files/515925/original/file-20230316-18-r21apr.gif?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=237&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/515925/original/file-20230316-18-r21apr.gif?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=237&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/515925/original/file-20230316-18-r21apr.gif?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=297&fit=crop&dpr=1 754w, https://images.theconversation.com/files/515925/original/file-20230316-18-r21apr.gif?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=297&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/515925/original/file-20230316-18-r21apr.gif?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=297&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">ConocoPhillips’ Willow project is in the northeast corner of the National Petroleum Reserve-Alaska.</span>
<span class="attribution"><a class="source" href="https://commons.wikimedia.org/wiki/File:NPRA_F1lg.gif">USGS, Department of Interior</a></span>
</figcaption>
</figure>
<h2>Opposition, with little success</h2>
<p>Opposition to the new Willow project has been driven by concerns about the effects of drilling on wildlife and of increasing fossil fuel use on the climate. Willow’s oil is estimated to be <a href="https://www.americanprogress.org/article/4-reasons-the-willow-oil-project-is-unfit-for-approval/%22%22">capable of releasing 287 million metric tons of carbon dioxide</a> if refined into fuels and consumed.</p>
<p>In particular, opponents have focused on a planned pipeline that will extend the existing infrastructure further westward, deeper into NPR-A, and likely encourage further exploratory drilling.</p>
<p>So far, that resistance has had little success. </p>
<p>Twenty miles to the south of Willow is <a href="https://www.adn.com/business-economy/energy/2022/08/25/environmental-groups-sue-to-stop-federal-approval-of-exploration-at-alaska-oil-project/">the Peregrine discovery area</a>, estimated to hold around 1.6 billion barrels of oil. Its development was approved by the Biden administration in late 2022. To the east lies the <a href="https://dog.dnr.alaska.gov/documents/resourceevaluation/01_ags_luncheon_presentation_04-24-18.pdf">Pikka-Horseshoe discovery area</a>, with around 2 billion barrels. It’s also likely to gain approval. Still other NPR-A drilling has occurred to the southwest (<a href="https://static.conocophillips.com/files/resources/conocophillips-alaska-factsheet-2022.pdf">Harpoon prospect</a>), northeast (Cassin), and southeast (Stirrup).</p>
<figure class="align-center ">
<img alt="Young protesters hold a sign reading: 'President Biden: Keep Your Climate Promises. Stop Willow.'" src="https://images.theconversation.com/files/515889/original/file-20230316-28-h52dvh.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/515889/original/file-20230316-28-h52dvh.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/515889/original/file-20230316-28-h52dvh.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/515889/original/file-20230316-28-h52dvh.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/515889/original/file-20230316-28-h52dvh.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/515889/original/file-20230316-28-h52dvh.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/515889/original/file-20230316-28-h52dvh.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Young protesters in Washington in 2022 urged Biden to reject the Willow project.</span>
<span class="attribution"><a class="source" href="https://www.gettyimages.com/detail/news-photo/climate-activist-hold-a-demonstration-to-urge-president-news-photo/1442291666">Jemal Countess/Getty Images for Sunrise AU</a></span>
</figcaption>
</figure>
<h2>Questions of legality</h2>
<p>One reason the Biden administration approved the Willow project involves legality: ConocoPhillips holds the leases and has a legal right to drill. Canceling its leases would bring a court case that, if lost, would set a precedent, cost the government millions of dollars in fees and do nothing to stop oil drilling. </p>
<p>Instead, the government made a deal with ConocoPhillips that <a href="https://www.politico.com/news/2023/03/13/biden-administration-approved-willow-alaska-oil-00086746">shrank the total surface area to be developed at Willow by 60%</a>, including removing a sensitive wildlife area known as Teshekpuk Lake. The Biden administration also announced that it was putting 13 million acres of the NPR-A and all federal waters of the Arctic Ocean <a href="https://www.doi.gov/pressreleases/biden-harris-administration-announces-sweeping-protections-16-million-acres-land-and">off limits to new leases</a>.</p>
<p>That has done little to stem anger over approval of the project, however. Two groups <a href="https://www.arctictoday.com/conocophillips-alaska-willow-project-approvals-hit-with-second-lawsuit/">have already sued</a> over the approval.</p>
<h2>Taking future risks into account</h2>
<p>To further understand Biden’s approval of the Willow project, one has to look into the future, too.</p>
<p>Discoveries in the northeastern NPR-A suggest this will become a major new oil production area for the U.S. While actual oil production is <a href="https://alaskabeacon.com/2023/01/19/state-expects-north-slope-oil-production-to-be-stable-and-then-tick-up-after-about-2027/">not expected there for several years</a>, its timing will coincide with a forecast plateau or decline in total U.S. production later this decade, because of what one shale company CEO described as <a href="https://oilprice.com/Energy/Crude-Oil/The-Shale-Boom-Is-Over.html">the end of shale oil’s aggressive growth</a>.</p>
<p>Historically, declines in domestic supply have brought higher fuel prices and imports. High gasoline and diesel prices, with their inflationary impacts, can weaken the political party in power. While current prices and inflation haven’t damaged Biden and the Democrats too much, nothing guarantees this will remain the case.</p>
<p><iframe id="jxwl9" class="tc-infographic-datawrapper" src="https://datawrapper.dwcdn.net/jxwl9/7/" height="400px" width="100%" style="border: none" frameborder="0"></iframe></p>
<h2>Geopolitical concerns, particularly Europe</h2>
<p>The Biden administration also faces geopolitical pressure right now due to Russia’s war on Ukraine.</p>
<p>U.S. companies <a href="https://www.cmegroup.com/openmarkets/energy/2023/u-s--crude-oil-exports-to-eu-support-wti-as-global-benchmark.html">ramped up exports</a> of oil and natural gas over the past year to become <a href="https://www.politico.com/news/2023/02/23/american-energy-europe-putin-00083750#:%7E:text=Instead%2C%20a%20flow%20of%20American,12%20percent%20of%20its%20oil.">a lifeline for Europe</a> as the European Union uses <a href="https://eu-solidarity-ukraine.ec.europa.eu/eu-sanctions-against-russia-following-invasion-ukraine_en">sanctions and bans on Russian fossil fuel imports</a> to try to weaken the Kremlin’s ability to finance its war on Ukraine. U.S. imports have been able to <a href="https://www.politico.com/news/2023/02/23/american-energy-europe-putin-00083750#:%7E:text=Instead%2C%20a%20flow%20of%20American,12%20percent%20of%20its%20oil.">replace a major portion</a> of Russian supply that Europe once counted on.</p>
<p>Europe’s energy crisis has also led to the return of <a href="https://www.iea.org/commentaries/where-things-stand-in-the-global-energy-crisis-one-year-on">energy security as a top concern</a> of national leaders worldwide. Without a doubt, the crisis has clarified that oil and gas are still critical to the global economy. The Biden administration is taking the position that reducing the supply by a significant amount – <a href="https://www.ipcc.ch/assessment-report/ar6/">necessary as it is</a> to avoid damaging climate change – cannot be done by prohibition alone. Halting new drilling worldwide would drive fuel prices sky high, weakening economies and the ability to deal with the climate problem. </p>
<p>Energy transitions depend on changes in demand, not just supply. As an energy scholar, I believe advancing the affordability of electric vehicles and the infrastructure they need would do much more for reducing oil use than drilling bans. Though it may seem counterintuitive, by aiding European economic stability, U.S. exports of fossil fuels may also help the EU plan to accelerate noncarbon energy use in the years ahead.</p><img src="https://counter.theconversation.com/content/201935/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Scott L. Montgomery does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Biden vowed ‘no more drilling on federal lands,’ but Russia’s war on Ukraine and pressures at home are hard to ignore.Scott L. Montgomery, Lecturer, Jackson School of International Studies, University of WashingtonLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1804612022-03-31T22:08:16Z2022-03-31T22:08:16ZBiden bets a million barrels a day will drive down soaring gas prices – what you need to know about the Strategic Petroleum Reserve<figure><img src="https://images.theconversation.com/files/455663/original/file-20220331-27-vt56yf.jpg?ixlib=rb-1.1.0&rect=83%2C56%2C1913%2C1167&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Several sites, such as this one near Freeport, Texas, store the hundreds of million of barrels in the United States' Strategic Petroleum Reserve.
</span> <span class="attribution"><a class="source" href="https://newsroom.ap.org/detail/TrumpBudgetOilReserve/1fad28d8a83747e8a102a2948130bd55/photo?Query=strategic%20petroleum%20reserve&mediaType=photo&sortBy=creationdatetime:desc&dateRange=Anytime&totalCount=21&currentItemNo=15">Department of Energy via AP</a></span></figcaption></figure><p>The Biden administration on March 31, 2022, said it <a href="https://www.whitehouse.gov/briefing-room/statements-releases/2022/03/31/fact-sheet-president-bidens-plan-to-respond-to-putins-price-hike-at-the-pump/">plans to release</a> an unprecedented 180 million barrels of oil from the U.S. Strategic Petroleum Reserve to combat the <a href="https://fred.stlouisfed.org/series/GASREGW">recent spike in gas</a> and <a href="https://www.washingtonpost.com/business/energy/the-oil-price-rally-is-bad-the-diesel-crisis-is-far-worse/2022/03/14/e207748a-a36c-11ec-8628-3da4fa8f8714_story.html">diesel prices</a>. About a million barrels of oil will be released every day for up to six months. </p>
<p>If all the oil is released, it would represent almost one-third of the <a href="https://www.eia.gov/dnav/pet/pet_stoc_wstk_dcu_nus_w.htm">current volume of the Strategic Petroleum Reserve</a>. It follows a <a href="https://www.energy.gov/articles/doe-announces-emergency-sale-30-million-barrels-crude-oil-strategic-petroleum-reserve">release of 30 million barrels</a> in early March, a large withdrawal until the latest one.</p>
<p>But what is the <a href="https://www.energy.gov/fecm/strategic-petroleum-reserve-9">Strategic Petroleum Reserve</a>, why was it created, and when has it been used? And does it still serve a purpose, given that the <a href="https://www.eia.gov/energyexplained/oil-and-petroleum-products/imports-and-exports.php">U.S. exports more oil and other petroleum products than it imports</a>?</p>
<p>As an <a href="https://scholar.google.com/citations?user=dCRySjIAAAAJ&hl=en&oi=ao">energy researcher</a>, I believe considering the reserve’s history can help answer these questions.</p>
<h2>Origins of the reserve</h2>
<p>Congress created the Strategic Petroleum Reserve as part of the <a href="https://www.govtrack.us/congress/bills/94/s622/text">Energy Policy and Conservation Act</a> of 1975 in response to a global oil crisis.</p>
<p>Arab oil-exporting states led by Saudi Arabia had <a href="https://history.state.gov/milestones/1969-1976/oil-embargo">cut supply to the world market</a> because of Western support for Israel in the 1973 Yom Kippur War. Oil <a href="https://www.federalreservehistory.org/essays/oil-shock-of-1973-74">prices quadrupled</a>, resulting in major economic damage to the U.S. and other countries. This also shook the average American, who had grown used to cheap oil.</p>
<p>The oil crisis caused the U.S., Japan and 15 other advanced countries to form the <a href="https://www.iea.org/about/history">International Energy Agency</a> in 1974 to recommend policies that would forestall such events in the future. One of the agency’s key ideas was to create <a href="https://www.iea.org/articles/oil-stocks-of-iea-countries">emergency petroleum reserves</a> that could be drawn on in case of a severe supply disruption. </p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="A map with red dots showing locations of SPR spots." src="https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=434&fit=crop&dpr=1 600w, https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=434&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=434&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=545&fit=crop&dpr=1 754w, https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=545&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=545&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">The map shows the locations of the oil held in the Strategic Petroleum Reserve.</span>
<span class="attribution"><a class="source" href="https://www.energy.gov/fecm/strategic-petroleum-reserve-4">Department of Energy</a></span>
</figcaption>
</figure>
<p>The Energy Policy and Conservation Act originally stipulated the reserve should hold up to 1 billion barrels of crude and refined petroleum products. Though it has never reached that size, the U.S. reserve is the largest in the world, with a <a href="https://www.energy.gov/fecm/strategic-petroleum-reserve-9">maximum volume of 714 million barrels</a>. The cap was previously set at 727 million barrels. </p>
<p>As of March 25, 2022, the reserve <a href="https://www.eia.gov/dnav/pet/pet_stoc_wstk_dcu_nus_w.htm">contained about 568 million barrels</a>.</p>
<p>Oil in the reserve is <a href="https://www.energy.gov/fecm/strategic-petroleum-reserve-4">stored underground</a> in a series of large underground salt domes in four locations along the Gulf Coast of Texas and Louisiana, and is linked to major supply pipelines in the region.</p>
<p>Salt domes, formed when a mass of salt is forced upward, <a href="https://cvmidstream.com/sound/">are a good choice for storage</a> since salt is impermeable and has low solubility in crude oil. Most of the storage sites were acquired by the federal government in 1977 and <a href="https://www.energy.gov/fecm/strategic-petroleum-reserve-4">became fully operational</a> in the 1980s. </p>
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<h2>History of drawdowns</h2>
<p>In the 1975 act, Congress specified that the reserve was intended to prevent “severe supply interruptions” – that is, actual oil shortages. </p>
<p>Over time, as the oil market has changed, Congress expanded the list of reasons for which the Strategic Petroleum Reserve could be tapped, such as domestic supply interruptions due to extreme weather. </p>
<p>Prior to March 2022, <a href="https://crsreports.congress.gov/product/pdf/R/R46355">about 280 million barrels</a> of crude oil had been released since the reserve’s creation, including a <a href="https://www.nytimes.com/2021/11/23/business/biden-oil-reserves-gas-prices.html">50 million release</a> that began in November 2021. </p>
<p><a href="https://www.energy.gov/fecm/strategic-petroleum-reserve-0#1991DesertStorm">There have only been three emergency releases</a> in the reserve’s history. The first was in 1991 after Iraq invaded Kuwait the year before, which <a href="https://www.econlib.org/archives/2014/06/who_caused_the.html">resulted in a sharp drop</a> in oil supply to the world market. The U.S. released 34 million barrels.</p>
<p>The second release, of 30 million barrels, came in 2005 after <a href="https://www.oe.netl.doe.gov/docs/HurricaneComp0508r2.pdf">Hurricanes Rita and Katrina knocked out Gulf of Mexico production</a>, which then comprised about 25% of U.S. domestic supply. </p>
<p>The third was a coordinated release by the International Energy Agency in 2011 as a result of <a href="https://www.bakerinstitute.org/media/files/files/d7396022/IFRI-pub-GlickStrategicOilReserves-2011.pdf">supply disruptions from several oil-producing countries</a>, including Libya, then facing civil unrest during the Arab Spring. In all, the agency coordinated a release of 60 million barrels of crude, half of which came from the U.S.</p>
<p>In addition, there have been <a href="https://www.energy.gov/fecm/strategic-petroleum-reserve-0">11 planned sales of oil from the reserve</a>, mainly to generate federal revenue. One of these – the 1996-1997 sale to reduce the federal budget deficit – <a href="https://www.nytimes.com/1996/04/30/us/president-decides-us-will-soon-sell-oil-from-reserves.html">seemed to serve political ends</a> rather than supply-related ones.</p>
<figure class="align-center ">
<img alt="Elderly white guy wearing a blue suit stands in front of a podium with the seal of the US president and gesticulates with both hands as a logo of the white house is displayed in the background" src="https://images.theconversation.com/files/455659/original/file-20220331-13-hvimgv.jpg?ixlib=rb-1.1.0&rect=233%2C65%2C4635%2C3014&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/455659/original/file-20220331-13-hvimgv.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/455659/original/file-20220331-13-hvimgv.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/455659/original/file-20220331-13-hvimgv.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/455659/original/file-20220331-13-hvimgv.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/455659/original/file-20220331-13-hvimgv.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/455659/original/file-20220331-13-hvimgv.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">President Joe Biden is betting that a massive release of oil from the nation’s petroleum reserve will help drive down gas prices.</span>
<span class="attribution"><a class="source" href="https://newsroom.ap.org/detail/Biden/e1d888e798a74dafb16bddec29101112/photo?Query=gas%20prices&mediaType=photo&sortBy=creationdatetime:desc&dateRange=Anytime&totalCount=4930&currentItemNo=28">AP Photo/Patrick Semansky</a></span>
</figcaption>
</figure>
<h2>A better way to avoid pain at the pump</h2>
<p>President Joe Biden’s November decision to tap the reserve <a href="https://www.politico.com/news/2021/11/23/biden-oil-reserves-gasoline-prices-523241">was also seen as political</a> by Republicans because there was no emergency shortage of supply at that time. </p>
<p>Similarly, the latest historic release of 180 million barrels could also be seen as serving a political purpose – in an election year, no less. But I believe it also seems perfectly legitimate in terms of fulfilling the Strategic Petroleum Reserve’s original purpose: reducing the negative impacts of a <a href="https://theconversation.com/oil-price-shocks-have-a-long-history-but-todays-situation-may-be-the-most-complex-ever-178861">major oil price shock</a>. </p>
<p>Though the U.S. <a href="https://www.eia.gov/todayinenergy/detail.php?id=49596">is today a net petroleum exporter</a>, it continues to import as much as <a href="https://www.eia.gov/dnav/pet/pet_move_impcus_a2_nus_ep00_im0_mbblpd_m.htm">8.2 million barrels</a> of crude oil every day. </p>
<p>[<em>Over 150,000 readers rely on The Conversation’s newsletters to understand the world.</em> <a href="https://memberservices.theconversation.com/newsletters/?source=inline-150ksignup">Sign up today</a>.]</p>
<p>But in my view, the best way to avoid the pain of <a href="https://theconversation.com/soaring-crude-prices-make-the-cost-of-pretty-much-everything-else-go-up-too-because-we-almost-literally-eat-oil-179809">oil price shocks</a> is to lower oil demand by <a href="https://theicct.org/publications/ev-us-market-growth-cities-sept21">reducing global carbon emissions</a> – rather than mainly relying on releases from the reserve. </p>
<p><em>This is an updated version of an <a href="https://theconversation.com/biden-taps-the-strategic-petroleum-reserve-what-is-it-where-did-it-come-from-and-does-the-us-still-need-it-172473">article originally published</a> on Nov. 24, 2021.</em></p><img src="https://counter.theconversation.com/content/180461/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Scott L. Montgomery does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The total release could reach 180 million barrels over six months, which would make it the biggest in the history of the Strategic Petroleum Reserve.Scott L. Montgomery, Lecturer, Jackson School of International Studies, University of WashingtonLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1724732021-11-24T13:42:06Z2021-11-24T13:42:06ZBiden taps the Strategic Petroleum Reserve – What is it? Where did it come from? And does the US still need it?<figure><img src="https://images.theconversation.com/files/433610/original/file-20211124-25-1haa6mm.jpg?ixlib=rb-1.1.0&rect=44%2C53%2C2950%2C1850&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The US Strategic Petroleum Reserve is the largest in the world. </span> <span class="attribution"><a class="source" href="https://newsroom.ap.org/detail/USPETROLEUMRESERVE/7ed5333768e5da11af9f0014c2589dfb/photo?Query=strategic%20petroleum%20reserve&mediaType=photo&sortBy=arrivaldatetime:desc&dateRange=Anytime&totalCount=20&currentItemNo=18">AP Photo/U.S. Department of Energy</a></span></figcaption></figure><p><a href="https://www.whitehouse.gov/briefing-room/statements-releases/2021/11/23/president-biden-announces-release-from-the-strategic-petroleum-reserve-as-part-of-ongoing-efforts-to-lower-prices-and-address-lack-of-supply-around-the-world/">President Joe Biden ordered</a> a release of oil from its Strategic Petroleum Reserve on Nov. 23, 2021, as a part of a coordinated effort with five other countries to tamp down rising fuel prices. The <a href="https://www.nytimes.com/2021/11/23/business/biden-oil-reserves-gas-prices.html">U.S. plans to tap 50 million barrels of crude oil</a> in the coming months, while the other nations – the U.K., India, Japan, Korea and China – are said to be releasing about 11 million barrels in total. </p>
<p>But what is the <a href="https://www.energy.gov/fecm/strategic-petroleum-reserve-9">Strategic Petroleum Reserve</a>, why was it created and when has it been used? And does it still serve a purpose, given that the <a href="https://www.eia.gov/energyexplained/oil-and-petroleum-products/imports-and-exports.php">U.S. exports more oil and other petroleum products than it imports</a>?</p>
<p>As an <a href="https://scholar.google.com/citations?user=dCRySjIAAAAJ&hl=en&oi=ao">energy researcher</a>, I believe considering the reserve’s history can help answer these questions.</p>
<h2>Origins of the reserve</h2>
<p>Congress created the Strategic Petroleum Reserve as part of the <a href="https://www.govtrack.us/congress/bills/94/s622/text">Energy Policy and Conservation Act</a> of 1975 in response to a global oil crisis.</p>
<p>Arab oil-exporting states led by Saudi Arabia had <a href="https://history.state.gov/milestones/1969-1976/oil-embargo">cut supply to the world market</a> because of Western support for Israel in the 1973 Yom Kippur War. Oil <a href="https://www.federalreservehistory.org/essays/oil-shock-of-1973-74">prices quadrupled</a>, resulting in major economic damage to the U.S. and other countries. This also shook the average American, who had grown used to cheap oil.</p>
<p>The oil crisis caused the U.S., Japan and 15 other advanced countries to form the <a href="https://www.iea.org/about/history">International Energy Agency</a> in 1974 to recommend policies that would forestall such events in the future. One of the agency’s key ideas was to create <a href="https://www.iea.org/articles/oil-stocks-of-iea-countries">emergency petroleum reserves</a> that could be drawn on in case of a severe supply disruption. </p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="A map with red dots showing locations of SPR spots." src="https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=434&fit=crop&dpr=1 600w, https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=434&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=434&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=545&fit=crop&dpr=1 754w, https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=545&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/433615/original/file-20211124-21-19klpqd.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=545&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">The map shows the locations of the oil held in the Strategic Petroleum Reserve.</span>
<span class="attribution"><a class="source" href="https://www.energy.gov/fecm/strategic-petroleum-reserve-4">Department of Energy</a></span>
</figcaption>
</figure>
<p>The Energy Policy and Conservation Act originally stipulated the reserve should hold up to 1 billion barrels of crude and refined petroleum products. Though it has never reached that size, the U.S. reserve is the largest in the world, with a maximum volume of 713.5 million barrels. It <a href="https://www.spr.doe.gov/dir/dir.html">currently holds a little over 600 million barrels</a> of crude oil. </p>
<p>Oil in the reserve is <a href="https://www.energy.gov/fecm/strategic-petroleum-reserve-4">stored underground</a> in a series of large underground salt domes in four locations along the Gulf Coast of Texas and Louisiana and is linked to major supply pipelines in the region.</p>
<p>Salt domes, formed when a mass of salt is forced upward, <a href="https://cvmidstream.com/sound/">are a good choice for storage</a> since salt is impermeable and has low solubility in crude oil. Most of the storage sites were acquired by the federal government in 1977 and <a href="https://www.energy.gov/fecm/strategic-petroleum-reserve-4">became fully operational</a> in the 1980s. </p>
<p><iframe id="7chGV" class="tc-infographic-datawrapper" src="https://datawrapper.dwcdn.net/7chGV/3/" height="400px" width="100%" style="border: none" frameborder="0"></iframe></p>
<h2>History of drawdowns</h2>
<p>In the 1975 act, Congress specified that the reserve was intended to prevent “severe supply interruptions” – that is, actual oil shortages. </p>
<p>Over time, as the oil market has changed, Congress expanded the list of reasons for which the SPR could be tapped, such as domestic supply interruptions due to extreme weather. </p>
<p>Before the latest drawdown, more than 230 million barrels of crude oil had been released since the reserve’s creation. The amount of the November 2021 release, 50 million barrels, is the largest so far. </p>
<p><a href="https://www.energy.gov/fecm/strategic-petroleum-reserve-0#1991DesertStorm">There have only been three emergency releases</a> in the reserve’s history. The first was in 1991 after Iraq invaded Kuwait the year before, which <a href="https://www.econlib.org/archives/2014/06/who_caused_the.html">resulted in a sharp drop</a> in oil supply to the world market. The U.S. released 33.75 million barrels. </p>
<p>The second release, of 30 million barrels, came in 2005 after <a href="https://www.oe.netl.doe.gov/docs/HurricaneComp0508r2.pdf">Hurricanes Rita and Katrina knocked out Gulf of Mexico production</a>, which then comprised about 25% of U.S. domestic supply. </p>
<p>The third was a coordinated release by the International Energy Agency in 2011 as a result of <a href="https://www.bakerinstitute.org/media/files/files/d7396022/IFRI-pub-GlickStrategicOilReserves-2011.pdf">supply disruptions from several oil-producing countries</a> including Libya, then facing civil unrest during the Arab Spring. In all, the IEA coordinated a release of 60 million barrels of crude, half of which came from the U.S.</p>
<p>In addition, there have been <a href="https://www.energy.gov/fecm/strategic-petroleum-reserve-0">11 planned sales of oil from the reserve</a>, mainly to generate federal revenue. One of these – in particular the 1996-1997 sale to reduce the federal budget deficit – <a href="https://www.nytimes.com/1996/04/30/us/president-decides-us-will-soon-sell-oil-from-reserves.html">seemed to serve political ends</a> rather than supply-related ones.</p>
<p>Biden’s decision to tap the reserve <a href="https://www.politico.com/news/2021/11/23/biden-oil-reserves-gasoline-prices-523241">was similarly seen as political</a> by Republicans because there’s no emergency shortage of supply. The <a href="https://www.whitehouse.gov/briefing-room/statements-releases/2021/11/23/president-biden-announces-release-from-the-strategic-petroleum-reserve-as-part-of-ongoing-efforts-to-lower-prices-and-address-lack-of-supply-around-the-world/">White House said</a> part of the release is an acceleration of planned sales approved by Congress, while the rest is an exchange that will return to the reserve over time. </p>
<figure class="align-center ">
<img alt="A gas station sign shows the prices of different types of gasoline with a gas station in the background" src="https://images.theconversation.com/files/433611/original/file-20211124-18-1g5td7j.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/433611/original/file-20211124-18-1g5td7j.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/433611/original/file-20211124-18-1g5td7j.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/433611/original/file-20211124-18-1g5td7j.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/433611/original/file-20211124-18-1g5td7j.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=502&fit=crop&dpr=1 754w, https://images.theconversation.com/files/433611/original/file-20211124-18-1g5td7j.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=502&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/433611/original/file-20211124-18-1g5td7j.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=502&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Gas prices have been rising across the U.S.</span>
<span class="attribution"><a class="source" href="https://newsroom.ap.org/detail/GasPricesBiden/9df20005f65a4e3f880300f486881b76/photo?Query=gas%20prices&mediaType=photo&sortBy=arrivaldatetime:desc&dateRange=Anytime&totalCount=4395&currentItemNo=2">AP Photo/Noah Berger</a></span>
</figcaption>
</figure>
<h2>Is the reserve still necessary?</h2>
<p>Because the U.S. <a href="https://www.eia.gov/todayinenergy/detail.php?id=49596">is today a net petroleum exporter</a>, the Strategic Petroleum Reserve has entered a new era. Some of its original rationale and function – to be used in emergencies to ensure the U.S. has a steady supply of oil – are gone.</p>
<p>And efforts to reduce global carbon emissions and the use of oil – for example, with <a href="https://theicct.org/publications/ev-us-market-growth-cities-sept21">more electric cars</a> and other vehicles on the road – will likely only reduce the need for such a reserve.</p>
<p>Indeed, Congress has recognized the reality that oil exports have been declining. It mandated <a href="https://www.energy.gov/fecm/strategic-petroleum-reserve-9">annual sales from the reserve</a> beginning in 2017 and extending through 2028 – for a total of 271 million barrels. </p>
<p>But as long as the reserve is available, Biden’s use of it primarily in hopes of reducing gas prices – <a href="https://www.cnn.com/2021/11/23/politics/biden-oil-reserves-gas-prices/index.html">which will take time to have any effect, if any</a> – suggests Americans will see many more similar releases in the years to come. </p>
<p>[<em>Get the best of The Conversation, every weekend.</em> <a href="https://memberservices.theconversation.com/newsletters/?source=inline-weeklybest">Sign up for our weekly newsletter</a>.]</p><img src="https://counter.theconversation.com/content/172473/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Scott L. Montgomery does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Biden ordered the release of 50 million barrels of crude oil to tamp down rising gas prices, the largest drawdown in the reserve’s history.Scott L. Montgomery, Lecturer, Jackson School of International Studies, University of WashingtonLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1546182021-02-22T13:23:41Z2021-02-22T13:23:41ZKeeping trees in the ground where they are already growing is an effective low-tech way to slow climate change<figure><img src="https://images.theconversation.com/files/385383/original/file-20210220-19-ptc3r4.JPG?ixlib=rb-1.1.0&rect=5%2C0%2C3860%2C2590&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">A mix of public and private forests in Oregon's Coast Range.</span> <span class="attribution"><span class="source">Beverly Law</span>, <a class="license" href="http://creativecommons.org/licenses/by-nd/4.0/">CC BY-ND</a></span></figcaption></figure><p>Protecting forests is an essential strategy in the fight against climate change that has not received the attention it deserves. Trees capture and store massive amounts of carbon. And unlike some strategies for cooling the climate, they don’t require costly and complicated technology. </p>
<p>Yet although <a href="https://www.weforum.org/agenda/2020/01/one-trillion-trees-world-economic-forum-launches-plan-to-help-nature-and-the-climate/">tree-planting initiatives are popular</a>, protecting and restoring existing forests rarely attracts the same level of support. As an example, forest protection was notably missing from the US$447 million <a href="https://www.energy.senate.gov/services/files/32B4E9F4-F13A-44F6-A0CA-E10B3392D47A">Energy Act of 2020</a>, which the U.S. Congress passed in December 2020 to jump-start technological carbon capture and storage.</p>
<p>In our work as <a href="https://scholar.google.com/citations?user=J2KWqAoAAAAJ&hl=en">forest carbon cycle</a> and <a href="https://fletcher.tufts.edu/people/william-moomaw">climate change</a> scientists, we track carbon emissions from forests to wood products and all the way to landfills – and from forest fires. Our research shows that protecting carbon in forests is essential for meeting global climate goals.</p>
<p>Ironically, we see the U.S. <a href="https://www.energy.gov/fe/services/petroleum-reserves/strategic-petroleum-reserve">Strategic Petroleum Reserve</a> as a model. This program, which was created after the 1973 oil crisis to guard against future supply disruptions, stores nearly 800 million gallons of oil in huge underground salt caverns along the coast of the Gulf of Mexico. We propose creating strategic forest carbon reserves to store carbon as a way of stabilizing the climate, much as the Strategic Petroleum Reserve helps to stabilize oil markets.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/385355/original/file-20210219-21-2j9pw2.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="Map showing forested areas of the continental U.S." src="https://images.theconversation.com/files/385355/original/file-20210219-21-2j9pw2.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/385355/original/file-20210219-21-2j9pw2.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=368&fit=crop&dpr=1 600w, https://images.theconversation.com/files/385355/original/file-20210219-21-2j9pw2.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=368&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/385355/original/file-20210219-21-2j9pw2.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=368&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/385355/original/file-20210219-21-2j9pw2.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=462&fit=crop&dpr=1 754w, https://images.theconversation.com/files/385355/original/file-20210219-21-2j9pw2.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=462&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/385355/original/file-20210219-21-2j9pw2.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=462&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">The U.S. has more than 800 million acres of natural and planted forests and woodlands, of which nearly 60% are privately owned.</span>
<span class="attribution"><a class="source" href="https://forest-atlas.fs.fed.us/">USDA/USFS</a></span>
</figcaption>
</figure>
<h2>Carbon stockpiles that grow</h2>
<p>Forests pull about one-third of all human-caused carbon dioxide emissions from the atmosphere each year. Researchers have calculated that ending deforestation and allowing mature forests to keep growing could <a href="https://doi.org/10.1038/nature25138">enable forests to take up twice as much carbon</a>. </p>
<p>Half of a tree’s stems, branches and roots are composed of carbon. Live and dead trees, along with forest soil, hold the equivalent of <a href="http://www.fao.org/documents/card/en/c/ca9825en/">80% of all the carbon currently in Earth’s atmosphere</a>.</p>
<p>Trees accumulate carbon over extremely long periods of time. For example, redwoods, Douglas firs and western red cedars in the coastal forests of the Pacific Northwest can live for <a href="https://doi.org/10.1073/pnas.0901970106">800 years or more</a>. When they die and decompose, much of that carbon ends up in soil, where it is stored for centuries or millennia. </p>
<p>Mature trees that have reached full root, bark and canopy development deal with climate variability better than young trees. Older trees also store more carbon. <a href="https://www.scientificamerican.com/article/are-old-growth-forests/">Old-growth trees</a>, which usually are hundreds of years old, store enormous quantities of carbon in their wood, and accumulate more carbon annually.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/385360/original/file-20210219-13-xsn4l1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="Flatbed rail cars stacked with large cut logs." src="https://images.theconversation.com/files/385360/original/file-20210219-13-xsn4l1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/385360/original/file-20210219-13-xsn4l1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=446&fit=crop&dpr=1 600w, https://images.theconversation.com/files/385360/original/file-20210219-13-xsn4l1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=446&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/385360/original/file-20210219-13-xsn4l1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=446&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/385360/original/file-20210219-13-xsn4l1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=561&fit=crop&dpr=1 754w, https://images.theconversation.com/files/385360/original/file-20210219-13-xsn4l1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=561&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/385360/original/file-20210219-13-xsn4l1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=561&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Log train in Washington state, 1935. Many of the oldest and largest trees in the Pacific Northwest were logged during the 20th century.</span>
<span class="attribution"><a class="source" href="https://www.gettyimages.com/detail/news-photo/log-train-washington-usa-john-d-cress-for-farm-security-news-photo/658411852?adppopup=true">John D. Cress, Farm Security Administration via Getty Images</a></span>
</figcaption>
</figure>
<p>There are many fallacies about forest carbon storage, such as the concern that wildfires in the American West are <a href="https://www.sfchronicle.com/california-wildfires/article/California-wildfires-emitted-a-huge-amount-of-15775044.php">releasing huge quantities of carbon</a> into the atmosphere. In fact, fires are a relatively small carbon source. For example, the massive Biscuit Fire, which burned 772 square miles in southwest Oregon in 2002, emitted <a href="https://doi.org/10.1073/pnas.1720064115">less than 10% of Oregon’s total emissions that year</a>.</p>
<p>Another false claim is that it’s OK from a climate perspective to cut trees and turn them into furniture, plywood and other items because <a href="https://oregonforests.org/sites/default/files/2020-07/OFRI_CarbonSpecialReport_DIGITAL.pdf">wood products</a> can <a href="https://doi.org/10.1073/pnas.1904231116">store substantial amounts of carbon</a>. These assertions fail to count <a href="https://doi.org/10.1186/s13021-016-0066-5">cradle-to-grave emissions</a> from logging and manufacturing, which can be substantial.</p>
<p>The wood products industry releases carbon in many ways, from manufacturing products and burning mill waste to the breakdown of short-lived items like paper towels. It takes decades to centuries for newly planted forests to accumulate the carbon storage levels of mature and old forests, and many planted forests are <a href="https://doi.org/10.5194/bg-10-3691-2013">repeatedly harvested</a>. </p>
<p>In a review that we conducted with colleagues in 2019, we found that overall, U.S. state and federal reporting <a href="https://doi.org/10.1088/1748-9326/ab28bb">underestimated wood product-related carbon dioxide emissions by 25% to 55%</a>. We analyzed Oregon carbon emissions from wood that had been harvested over the past century and discovered that 65% of the original carbon returned to the atmosphere as CO2. Landfills retained 16%, while just 19% remained in wood products. </p>
<p>In contrast, protecting high carbon-density western U.S. forests that have low vulnerability to mortality from drought or fire would sequester the equivalent of about <a href="https://doi.org/10.1002/eap.2039">six years</a> of fossil fuel emissions from the entire western U.S., from the Rocky Mountain states to the Pacific coast. </p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/384080/original/file-20210213-23-50vrw2.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="A stand of never-logged tall trees." src="https://images.theconversation.com/files/384080/original/file-20210213-23-50vrw2.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/384080/original/file-20210213-23-50vrw2.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=643&fit=crop&dpr=1 600w, https://images.theconversation.com/files/384080/original/file-20210213-23-50vrw2.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=643&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/384080/original/file-20210213-23-50vrw2.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=643&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/384080/original/file-20210213-23-50vrw2.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=808&fit=crop&dpr=1 754w, https://images.theconversation.com/files/384080/original/file-20210213-23-50vrw2.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=808&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/384080/original/file-20210213-23-50vrw2.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=808&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">This old-growth forest in Opal Creek, Ore., where some trees are 500 years old or more, stores huge quantities of carbon.</span>
<span class="attribution"><span class="source">Beverly Law</span>, <a class="license" href="http://creativecommons.org/licenses/by-nd/4.0/">CC BY-ND</a></span>
</figcaption>
</figure>
<h2>Focus on big trees</h2>
<p>In a recently published analysis of carbon storage in six national forests in Oregon, we showed why a strategic forest carbon reserve program should <a href="https://doi.org/10.3389/ffgc.2020.594274">focus on mature and old forests</a>. Big trees, with trunks more than 21 inches in diameter, make up just 3% of these forests but store 42% of the above-ground carbon. Globally, a 2018 study found that the largest-diameter 1% of trees hold <a href="https://doi.org/10.1111/geb.12747">half of all the carbon stored in the world’s forests</a>. </p>
<p>Findings like these are spurring interest in the idea of <a href="https://doi.org/10.3389/ffgc.2019.00027">proforestation</a> – keeping existing forests intact and letting them grow to their full potential. Advocates see proforestation as an effective, immediate and low-cost strategy to store carbon. Older forests are more resilient to climate change than <a href="https://doi.org/10.3402/tellusb.v64i0.17159">young</a> tree plantations, which are more susceptible to drought and severe wildfires. Like the 2,000-year-old redwoods in California that have <a href="https://www.nbcnews.com/news/us-news/2-000-year-old-redwoods-survive-wildfire-california-s-oldest-n1237949">survived recent wildfires</a>, many tree species in old forests have lived through past climate extremes.</p>
<p>Creating forest carbon reserves would also conserve critical habitat for many types of wildlife that are threatened by human activities. Connecting these reserves to other parks and refuges could help <a href="https://theconversation.com/can-climate-corridors-help-species-adapt-to-warming-world-61190">species that need to migrate</a> in response to climate change. </p>
<figure>
<iframe width="440" height="260" src="https://www.youtube.com/embed/d67JPJETqxs?wmode=transparent&start=0" frameborder="0" allowfullscreen=""></iframe>
<figcaption><span class="caption">Less than 3% of land conserved in the Northeast U.S. is forever-wild. The Northeast Wilderness Trust is working with landowners, volunteers, and other conservation organizations to rewild the Northeastern landscape.</span></figcaption>
</figure>
<h2>Using forests to meet climate goals</h2>
<p>More than half of U.S. forested lands <a href="https://www.fs.fed.us/nrs/pubs/inf/nrs_inf_31_15-NWOS-whoowns.pdf">are privately owned</a>, so strategic forest carbon reserves should be established on both public and private lands. The challenge is paying for them, which will require a major shift in government and societal priorities. We believe that transferring public investment in oil and gas subsidies to pay private land owners to keep their forests growing could act as a <a href="https://www.nrcs.usda.gov/wps/portal/nrcs/detailfull/or/technical/cp/?cid=stelprdb1262209">powerful incentive</a> for private land owners. </p>
<p>Many researchers and conservation advocates have called for comprehensive actions to <a href="https://theconversation.com/to-solve-climate-change-and-biodiversity-loss-we-need-a-global-deal-for-nature-115557">slow climate change and reduce species losses</a>. One prominent example is the <a href="https://www.ncel.net/2020/02/27/30x30-land-and-water-conservation-in-the-states/">30x30 initiative</a>, which seeks to <a href="https://doi.org/10.1126/sciadv.aaw2869">conserve 30% of the world’s land and oceans by 2030</a>. In an executive order on Jan. 27, 2021, President Biden directed his administration to develop plans for conserving at least 30% of <a href="https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/27/executive-order-on-tackling-the-climate-crisis-at-home-and-abroad/">federally controlled lands and waters</a> by 2030. </p>
<p>Recent projections show that to prevent the worst impacts of climate change, governments will have to increase their pledges to reduce carbon emissions by <a href="https://doi.org/10.1038/s43247-021-00097-8">as much as 80%</a>. We see the next 10 to 20 years as a critical window for climate action, and believe that permanent protection for mature and old forests is the greatest opportunity for near-term climate benefits. </p>
<p>[<em>The Conversation’s science, health and technology editors pick their favorite stories.</em> <a href="https://theconversation.com/us/newsletters/science-editors-picks-71/?utm_source=TCUS&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=science-favorite">Weekly on Wednesdays</a>.]</p><img src="https://counter.theconversation.com/content/154618/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Beverly Law receives funding from US Department of Energy and the National Science Foundation. She is a Fellow of the Earth Leadership Program.</span></em></p><p class="fine-print"><em><span>William Moomaw receives funding from the Rockefeller Brothers Fund. He is affiliated with the Woodwell Climate Research Center, the Climate Group – North America, the Earthwatch Institute and the Nature Conservancy,
</span></em></p>Permanently protecting large, mature forests is a faster and cheaper way to stabilize Earth’s climate than complex carbon capture and storage schemes, and more effective than planting new trees.Beverly Law, Professor Emeritus of Global Change Biology and Terrestrial Systems Science, Oregon State UniversityWilliam Moomaw, Professor Emeritus of International Environmental Policy, Tufts UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1007082018-08-10T10:40:17Z2018-08-10T10:40:17ZWhy Trump shouldn’t leverage the government’s emergency oil supply to bolster the GOP<figure><img src="https://images.theconversation.com/files/231134/original/file-20180808-191044-hwvwdc.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">President Gerald Ford discussing plans for a Strategic Petroleum Reserve with workers in California in 1975</span> <span class="attribution"><a class="source" href="https://www.fordlibrarymuseum.gov/library/whphotos/A3883_NLGRF.jpg">Gerald R. Ford Presidential Library & Museum</a></span></figcaption></figure><p><a href="https://twitter.com/realDonaldTrump/status/1014611307427966976">President Donald Trump</a> has publicly griped about the <a href="https://www.eia.gov/dnav/pet/hist/RWTCD.htm">prices of oil</a> and <a href="https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=EMM_EPM0_PTE_NUS_DPG&f=W">gasoline</a>, which are at their highest levels in four years.</p>
<p>If oil supplies were to suddenly grow, those prices might well decline. That is why, according to unnamed sources, his administration is reportedly considering selling some of the oil stowed in the nation’s <a href="https://www.cnbc.com/2018/07/24/what-happens-if-president-trump-taps-the-strategic-petroleum-reserve.html">Strategic Petroleum Reserve</a> and urging U.S. allies like Saudi Arabia to <a href="https://www.washingtonpost.com/business/economy/trump-is-angry-at-opec-over-oil-prices-experts-say-trump-shares-the-blame/2018/07/05/7c1cae18-8059-11e8-b0ef-fffcabeff946_story.html?utm_term=.549a44c1f4e6">pump more oil</a>.</p>
<p>Should Trump attempt to lower gas prices to gain favor with voters, it wouldn’t be the first time a president has tapped the strategic reserve in advance of an election. But it would be the first time such a move was made solely for political reasons. And I believe it would be a particularly cavalier action in light of <a href="https://www.eia.gov/todayinenergy/detail.php?id=35032">Congress’ recent moves to sharply reduce the amount of oil in the reserve</a> and the energy insurance it’s provided for over three decades.</p>
<p>Based on what <a href="https://scholar.google.com/citations?user=kQdHRewAAAAJ&hl=en&authuser=1">I’ve learned</a> from researching <a href="https://jhupbooks.press.jhu.edu/content/coal-and-empire">the links between energy and national security</a> since the 19th century, I see in these moves a strategic shift that ought to worry Americans.</p>
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<h2>Energy independence</h2>
<p>Congress and President Gerald Ford’s administration created the Strategic Petroleum Reserve in the mid-1970s to insulate the country from <a href="https://us.macmillan.com/books/9780809075072">oil supply interruptions</a>.</p>
<p>At the time, the U.S. had become much more <a href="http://americanhistory.si.edu/american-enterprise-exhibition/consumer-era/energy-crisis">reliant on imported oil</a>. And there were deep concerns about supply interruptions because in 1973, the Arab members of the OPEC oil cartel imposed an embargo on countries, including the U.S., that were supporting Israel in the Yom Kippur War.</p>
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<p>Crude oil prices out of the Middle East <a href="https://www.npr.org/news/specials/oil/gasprices.chronology.html">quadrupled in just a few months</a>, pushing up prices at American gas pumps.</p>
<p>Since that energy crisis, the federal government has made achieving U.S. “<a href="https://www.thedailybeast.com/donald-trump-doesnt-understand-what-it-means-to-make-america-energy-independent">energy independence</a>,” or at least resilience, a top priority.</p>
<p>Over the decade following 1975, the government <a href="https://doi.org/10.1093/ahr/121.5.1705">built the reserve</a> in roughly 60 caverns hollowed out of underground salt domes at four sites in Texas and Louisiana. The U.S. also has become <a href="https://www.iea.org/about/history/">one of about 30</a> industrialized, oil-consuming countries that maintain emergency oil supplies around the globe and coordinate responses to future disruptions, like those following the <a href="https://www.energy.gov/fe/services/petroleum-reserves/strategic-petroleum-reserve/releasing-oil-spr#2011-IEA-Coordinated-Release">revolution in Libya in 2011</a>.</p>
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<h2>Political expediency</h2>
<p>But the release that the Trump team is reportedly mulling appears to be timed not for a petroleum shortfall but to <a href="https://www.usatoday.com/story/money/energy/2018/06/29/can-president-trump-counter-soaring-gas-prices-tapping-reserves/744528002/">make voters feel less pinched</a> when they fill their tanks – or fill out their ballots.</p>
<p>If that happens, without any verifiable supply bottlenecks, it would mark an unprecedented attempt to benefit the party in power by <a href="https://oilprice.com/Energy/Energy-General/Can-Trump-Counter-Soaring-Gasoline-Prices.html">temporarily cutting gasoline prices</a> – or at least to persuade voters that the administration is trying to make that happen.</p>
<p>The closest parallel of a contested election-year release happened in 2000, <a href="https://www.energy.gov/fe/services/petroleum-reserves/strategic-petroleum-reserve/releasing-oil-spr#2000HOExchange">when then-President Bill Clinton</a> released 2.7 million barrels of reserve crude – and later 30 million additional barrels – to relieve a shortage of residential heating oil in the northeast. </p>
<p><a href="https://www.theglobeandmail.com/report-on-business/rob-commentary/gores-move-to-release-oil-serves-only-to-grease-votes/article770226/">Critics decried</a> the moves as ploys to aid the presidential campaign of then-Vice President Al Gore, <a href="https://money.cnn.com/2000/09/22/news/oil_spr/">who had called for such a release</a>. But, unlike the situation today, a <a href="https://archive.bangordailynews.com/2000/09/14/collins-asks-clinton-to-tap-into-petroleum-reserve/">bipartisan group of lawmakers from oil-consuming states</a> had demanded it and <a href="https://news.gallup.com/poll/2449/american-public-supports-decision-tap-oil-reserves.aspx">public support was solidly behind it</a>.</p>
<p>Among those who criticized Clinton’s move was then-presidential candidate and <a href="https://money.cnn.com/2000/09/21/economy/gore_oil/">former oilman George W. Bush</a>. After assuming office in 2001, the second President Bush sought to fill the reserve to full capacity for the first time and only release oil during emergencies when refineries could not buy crude, and not simply because of high prices, no matter how much of an economic hardship these prices imposed. </p>
<p>On his watch, that meant selling some of the oil after <a href="https://money.cnn.com/2005/09/26/news/economy/bush/">Hurricane Katrina</a> interfered with refining along the Gulf Coast. In <a href="http://www.presidency.ucsb.edu/ws/index.php?pid=24446">Bush’s 2007 State of the Union address</a>, he called for the reserve to be doubled to 1.5 billion barrels, but <a href="https://www.reuters.com/article/us-congress-oil/senate-rejects-bush-policy-of-boosting-oil-reserve-idUSWBT00897920080513">Congress rejected even smaller increases almost unanimously as uneconomical</a>.</p>
<p>Another difference from past emergency reserve releases, should there be a sale soon, is that domestic oil production has risen sharply in recent years due to technological innovations like <a href="https://www.reuters.com/article/us-usa-oil-record-shale-analysis/u-s-oil-industry-set-to-break-record-upend-global-trade-idUSKBN1F50HV">hydraulic fracturing and horizontal drilling</a>. </p>
<p>That growth – which brought the <a href="https://www.eia.gov/tools/faqs/faq.php?id=32&t=6">country’s dependence on imported oil</a> to a 50-year low in 2017 – has made many politicians believe that maintaining more than 700 million barrels of oil has become an unnecessary extravagance.</p>
<p>In fact, Congress has already mandated the gradual sale of some <a href="https://www.oilandgas360.com/congress-readies-to-sell-off-empty-space-in-strategic-petroleum-reserve/">300 million barrels</a> of this oil over the coming decade. The proceeds would fund either unrelated spending, deferred maintenance on the reserves themselves, or pay for <a href="https://www.eia.gov/todayinenergy/detail.php?id=35032">revenue lost from the assorted tax cuts</a> that took effect in 2018. These reductions may make the country less prepared to deal with real supply disruptions in the future, like a catastrophic Iranian-Saudi Arabian war. </p>
<p>Anticipating these reductions, in July, House Republicans began discussing <a href="https://energycommerce.house.gov/hearings/doe-modernization-legislation-to-authorize-a-pilot-project-to-commercialize-the-strategic-petroleum-reserve/">plans to lease or even sell storage space in the reserve to private companies</a>.</p>
<p>Further distinguishing a fall release from previous ones, <a href="https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MOCIDUS2&f=M">U.S. refineries are currently running at nearly full capacity</a>, raising questions of how selling this oil would even benefit consumers.</p>
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<p>It is possible – and in the context of global warming, desirable – that someday, the U.S. economy will no longer rely on petroleum and therefore will have no need for a Strategic Petroleum Reserve. Until then, I do not see how it can make sense for political opportunism to influence the nation’s energy strategy.</p><img src="https://counter.theconversation.com/content/100708/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Peter Shulman does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>There’s no precedent for selling oil from the Strategic Petroleum Reserve at a time when there’s no market-driven reason for doing that.Peter Shulman, Associate Professor of History, Case Western Reserve UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/451982015-08-18T10:06:43Z2015-08-18T10:06:43ZDoes selling oil from the Strategic Petroleum Reserve make sense now?<figure><img src="https://images.theconversation.com/files/91809/original/image-20150813-21398-72hsbn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Stored underground: a strategic reserve, or source of funds?</span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/departmentofenergy/15130870665/in/album-72157650952181306/">US Department of Energy</a></span></figcaption></figure><p>Some members of Congress have proposed a novel way to fund the country’s Highway Trust Fund: tapping the Strategic Petroleum Reserve (SPR). One <a href="http://www.wsj.com/articles/congress-eyes-sales-from-nations-oil-stockpile-for-highway-funding-1437609382">proposal put forward</a> in the US Senate would sell 101 million barrels of crude oil held in the SPR to raise US$9 billion to extend the trust fund three years. The sale would take place over the 2018-2025 period.</p>
<p>The reserve has been tapped before, but this proposal comes during a surge in domestic oil production in the US and the lowest oil prices in six years. </p>
<p>To get a handle on what using oil from the SPR could mean, we first need to understand what it is, what it is not, and how we should decide whether it’s wise to sell proceeds to fund highway projects.</p>
<h2>Salt dome caverns</h2>
<p>First, and briefly, what the SPR is not. </p>
<p>In the early 1900s, the federal government created the Naval Petroleum and Oil Shale Reserve (NPOSR) to provide oil supply security for the US Navy, whose ships were moving in the direction of being largely oil-powered. There is also the National Petroleum Reserve-Alaska (NPR-A) but none of the NPR or NPR-A is or was part of the SPR.</p>
<p>The SPR, on the other hand, is not one single reserve but a series of salt dome caverns that hold inventories of produced crude oil. It is being stored specifically for emergency use to address significant crude oil supply interruptions.</p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/91811/original/image-20150813-21398-1fy1w1k.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/91811/original/image-20150813-21398-1fy1w1k.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/91811/original/image-20150813-21398-1fy1w1k.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=750&fit=crop&dpr=1 600w, https://images.theconversation.com/files/91811/original/image-20150813-21398-1fy1w1k.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=750&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/91811/original/image-20150813-21398-1fy1w1k.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=750&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/91811/original/image-20150813-21398-1fy1w1k.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=943&fit=crop&dpr=1 754w, https://images.theconversation.com/files/91811/original/image-20150813-21398-1fy1w1k.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=943&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/91811/original/image-20150813-21398-1fy1w1k.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=943&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">A view of one of the underground caverns in Louisiana and Texas that stores oil from the strategic reserve.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/departmentofenergy/14942546277/in/album-72157650952181306/">US Department of Energy</a></span>
</figcaption>
</figure>
<p>The SPR was created in 1975 in response to the oil embargo of 1973-74 orchestrated by the Organization of Petroleum Exporting Countries (OPEC), and it grew out of the Energy Policy and Conservation Act of 1975. The SPR consists of 62 underground salt dome caverns distributed across Louisiana and Texas. These are linked to several pipelines that can deliver oil to Gulf Coast refineries and beyond. In addition, the SPR has access to port facilities to deliver crude, which came from both domestic and foreign sources, to refineries on the East Coast and the West Coast via marine transport. </p>
<p>Volumes were significantly increased during the Reagan administration, from 270 million barrels to nearly 590 million, according to the US Energy Information Administration (EIA). The level was relatively stable until 2001, when George W Bush decided to increase the SPR to its capacity. Between entering and leaving office, the Bush administration took the SPR level from 540 million to 726 million barrels.</p>
<p>The maximum level of inventories was 727 million barrels, which was still short of the one billion barrels of authorized capacity. As of July 17 2015, the SPR contained more than 695 barrels of crude oil.</p>
<h2>Role of oil prices</h2>
<p>Net imports are defined as the difference between our imports and exports of crude oil and refined oil products. Our <a href="http://www.eia.gov/dnav/pet/pet_move_neti_a_EP00_IMN_mbblpd_m.htm">net imports</a> have trended down over the past five years, from over 10 million barrels per day in 2010 to 4.6 million barrels per day on average for May 2015.</p>
<p>The US has an obligation through its participation in the International Energy Agency (<a href="http://www.iea.org/">IEA</a>) to maintain 90 days of strategic reserves based on net imports (the IEA was founded in 1974, also in response to the OPEC oil embargo). The current storage level and the net imports for 2014 imply that the SPR currently provides 138 days of supply in the event of a disruption. </p>
<p>Based on these figures, there does seem to be sufficient volumes in storage to accommodate a 101 million barrel sale and still have a 90-day buffer. But should our discussion stop with simple volumetric comparisons?</p>
<p>The rules governing the sale and distribution of crude oil from the SPR, however, do not actually allow for such a sale. The crude oil in the SPR is only to be sold and distributed in response to a significant interruption in the flow of crude oil. The intent is to avoid a severe domestic fuel price increase in response to such an interruption. </p>
<p>According to its mandate, the SPR is not to be used to attempt to manipulate prices. It is meant to meet emergency supply shortfalls. </p>
<p>The currently proposed sale does not seem to meet these requirements. Rather, it appears to be a political decision to avoid the need to cut expenditures in other programs or to raise new revenues, perhaps through an increase in the federal fuel tax, to meet the needs of the highway trust fund. Indeed, historically it is the federal fuel tax that has provided the revenue support mechanism for the federal highway trust fund.</p>
<h2>Will it fit the bill?</h2>
<p>So far in its history, there have been six sales from the SPR. Five of these were either to meet an emergency crude oil supply interruption or to test the delivery system. The one <a href="http://energy.gov/fe/services/petroleum-reserves/strategic-petroleum-reserve/filling-strategic-petroleum-reserve">non-emergency sale was in 1996-97</a> during the Clinton administration. It has been suggested that this was an effort to have an impact on gasoline prices in an election year; the release was 28 million barrels.</p>
<p>But if the proposed SPR sale does go forward, what is the likelihood that it will actually raise the $9 billion in revenue sought? At current prices, 101 million barrels, if sold all at once, would raise roughly $4.3 billion. The proponents assume an average price over the 2018-2015 period of about $89 per barrel. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/91673/original/image-20150812-18068-14kutk0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/91673/original/image-20150812-18068-14kutk0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/91673/original/image-20150812-18068-14kutk0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=480&fit=crop&dpr=1 600w, https://images.theconversation.com/files/91673/original/image-20150812-18068-14kutk0.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=480&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/91673/original/image-20150812-18068-14kutk0.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=480&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/91673/original/image-20150812-18068-14kutk0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=603&fit=crop&dpr=1 754w, https://images.theconversation.com/files/91673/original/image-20150812-18068-14kutk0.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=603&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/91673/original/image-20150812-18068-14kutk0.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=603&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">An aerial view of three DOE tanks near a refinery in Nederland, Texas.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/departmentofenergy/14944303958/in/album-72157650952181306/">US Department of Energy</a></span>
</figcaption>
</figure>
<p>To put this value in context, the current forward curve in the <a href="http://www.cmegroup.com/trading/energy/crude-oil/light-sweet-crude.html">NYMEX futures market</a> for West Texas Intermediate (WTI) crude oil extends only to December of 2023, and on a rising price curve reaches just $64.73; the average price over the 2018-2023 period is about $65 per barrel. So there appears to be a substantial gap between what the proposed sale is meant to generate and what the market sees as a likely price at the time of this writing. </p>
<p>While selling 101 million barrels from the currently held volumes would leave the US well above its IEA obligation, an important question is whether this is an appropriate use of this strategic national asset designed as an important source of US national energy security. </p>
<p>US Senator Murkowski (Alaska), chairperson of the Senate Energy and Natural Resources Committee, has taken a strong stand <a href="http://www.wsj.com/articles/congress-eyes-sales-from-nations-oil-stockpile-for-highway-funding-1437609382">against the proposal</a>. One key aspect of the senator’s argument is that the Department of Energy has only recently begun an analysis of the role of the SPR in providing for energy security for the US in a world that is much different than the one that existed in the 1970s, when the SPR was created.</p>
<h2>User pays</h2>
<p>An alternative to selling off SPR barrels to raise $9 billion would instead be to increase the federal fuel tax. </p>
<p>Over the past five years, our <a href="http://www.eia.gov/petroleum/data.cfm#consumption">gasoline consumption</a> has averaged 8.88 million barrels per day (mmbd), which translates to about 130,000 million gallons per year. The EIA has forecast that gasoline consumption will fall from 8.7 mmbd in 2013 to 6.7 mmbd in 2040 because of improving fuel efficiency mandates and other reasons. If we take a seven mmbd value to be representative of what the average may be during the 2018-2025 period, the $9 billion could be raised over the same time period by increasing the gasoline tax by just $0.01 per gallon.</p>
<p>This seems a pretty modest amount to help pay for our federal highway system maintenance in what amounts to a user-pays approach. This $0.01 per gallon is also conservative (in that it is relatively high) because it does not include revenues that would be generated from increased tax on highway diesel fuel sales.</p>
<p>It seems that to sell SPR volumes is simply to postpone the inevitable. Since we have obligations to our IEA partners to maintain strategic reserves, at some point in the future we will have to bite the bullet and fund our highways with revenue generation that does not draw on the SPR. </p>
<p>Also, if we start down this path, where and when will it end?</p>
<p>At current crude oil prices, the sale of 101 million barrels will fall far short of the “required” $9 billion. So do we then return to the SPR for more barrels until we get to the $9 billion? And if using revenues from sales of our strategic energy security supply for highway maintenance seems a good idea, why not sell off more of the inventories to fund schools or airports, or any of myriad other non-energy security government programs in need of funding? This just seems like a bad idea.</p>
<p>If the studies now under way to reassess the role of the SPR find that the required level of storage can be less than we now hold, any revenues generated from selling such excess should first be used to address identified energy security infrastructure investments. We need to ensure the remaining SPR volumes can actually get into the supply system across the country and provide effective protection from severe interruptions – as the SPR was established to do.</p><img src="https://counter.theconversation.com/content/45198/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ronald Ripple does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>It’s been done before but tapping the Strategic Petroleum Reserve – particularly when prices for oil are low – isn’t the best way to fund the Highway Trust Fund.Ronald Ripple, Mervin Bovaird Professor of Energy Business and Finance, University of TulsaLicensed as Creative Commons – attribution, no derivatives.