Friday, June 24, 2011

Drawing on the US Emergency Oil Reserve

In the past few days, the Strategic Petroleum Reserve has come into the news again.  An announcement that oil might be released from this stockpile, was enough to drop the price of oil and gasoline significantly.  This diagram below, courtesy of Reuters, provides a quick overview of the storage situation.


This reserve has only been accessed twice previously - both in emergency circumstances that are not evident this time (other than the President's low polling numbers).  In both of those cases, only a small percentage of the oil approved for use was actually needed.

As an interesting aside, recently on a cruise I befriended 2 very experienced oil-field engineers.  They did not have the above view of the reserve quality, but rather stated quite clearly that the solid (unleakable) underground salt caverns were a myth and that most of the oil stored in these sites will never be available for use.  

I have not seen any further evidence to support this, however, it is food for thought...

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