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House SPR oil purchase hearing splits along party lines

Oil & Gas Journal

Nick Snow
Washington Editor

WASHINGTON, DC, Apr. 25 -- Democrats and Republicans at an Apr. 24 US House committee hearing on continuing oil purchases for the Strategic Petroleum Reserve when prices are breaking records disagreed on which government policies send the wrong signals to markets.

Democrats on the Select Committee on Energy Independence and Global Warming said suspending purchases for the SPR would effectively ease upward price pressure by sending more oil onto global markets instead of into storage. Republicans responded that authorizing leasing with appropriate environmental safeguards within the Arctic National Wildlife Refuge and on more of the Outer Continental Shelf would be even more effective.

Witnesses testifying before the committee offered recommendations ranging from generating more research and development funding by exchanging some light, sweet crude in the reserve for heavier grades to adjusting scheduled deliveries of royalty in-kind crude so that continuing to fill the SPR would cost less money.