Exports of crude oil from the United States' emergency stockpile have surged to a record high due to the most significant supply disruption on record caused by the war involving Iran.
Data compiled by Kpler Ltd. shows that nearly 22 million barrels of crude from the US Strategic Petroleum Reserve (SPR) have been sold to overseas markets so far this year. This volume has already surpassed the previous record set four years ago, when a large amount of reserve crude was released following the conflict between Russia and Ukraine.
While exports of US emergency reserve crude are not uncommon, the scale of shipments this year indicates that global markets are increasingly relying on US supplies to cope as supply disruptions intensify with the near-closure of the Strait of Hormuz. Approximately one in every three barrels flowing out of the emergency reserve is being exported.
The volume going overseas could climb even higher, as the current administration continues to release the full 172 million barrels of crude it has pledged. This action is part of a larger initiative by the International Energy Agency (IEA) aimed at helping to cushion the impact of the Iran war on global energy markets.
The majority of the exported crude, or about 90%, is destined for Europe, flowing to the Netherlands and, for the first time, to refiners in Greece, Bulgaria, and Turkey. At least one cargo is heading to Asia. The supertanker Arosa, loaded with 1.2 million barrels of Bryan Mound Sour crude, shows its destination as Bataan in the Philippines.
The commodity trading firm Trafigura Group has emerged as the largest buyer of SPR crude, followed by refiner Marathon Petroleum Corp and the trading arm of Shell.
As supplies continue to be drawn down, stockpiles are rapidly approaching their lowest levels since the 1980s. This has raised concerns about US domestic energy security at a time when gasoline prices remain elevated.
Refilling of the reserve could begin as early as September under a replacement plan, at which time traders and refiners will start returning crude borrowed from the stockpile. The government's plan involves lending out 172 million barrels of crude in exchange for the return of approximately 200 million barrels.
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