Energy News Today

Strategic Petroleum Reserve created after Arab oil embargo

The Strategic Petroleum Reserve (SPR) has been a controversial part of the energy debate since the first Arab oil embargo.

During the 1973 Arab-Israeli War, Arab members of the Organization of Petroleum Exporting Countries (OPEC) imposed an embargo against the United States in retaliation for the U.S. decision to re-supply the Israeli military. Shortages of crude oil and petroleum products resulted which created rapidly rising prices and long lines at gasoline pumps.

The embargo highlighted the nation’s dependence on oil imports from unfriendly Arab countries. Political leaders in Washington decided to implement policies designed to conserve petroleum products, such as the 55-miles-per-hour speed limit and fuel economy standards for vehicles.

The federal government also passed legislation creating the SPR.

One of the SPR’s core missions is to hold enough oil stocks to fulfill U.S. obligations under the International Energy Program, the 1974 treaty obligated the U.S. to maintain stocks of crude oil and petroleum products, both public and private, to provide at least 90 days of U.S. net import protection. The U.S. Department of Energy calculates this value by dividing the SPR inventory level by the Energy Information Administration’s (EIA) sum for net crude oil and petroleum product imports.

Read More: Strategic Petroleum Reserve created after Arab oil embargo

2021-12-04 17:06:12

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