U.S. to buy 6 million barrels of crude oil at $79/barrel, up from $70/barrel

On October 19, the U.S. Department of Energy announced a significant development in the nation's energy strategy under President Joe Biden's administration. The plan involves the acquisition of 6 million barrels of crude oil, scheduled for delivery to the Strategic Petroleum Reserve (SPR) in the coming months of December and January.

This latest move indicates a substantial shift in the administration's approach to replenishing the SPR. The Department of Energy is now setting its sights on securing oil purchase contracts at a rate of $79 per barrel. This rate marks a noticeable increase from their previously targeted price range, which hovered around $70 per barrel.

It's crucial to acknowledge that this revised price target of $79 per barrel for crude oil purchases still falls below the current benchmark futures price for U.S. oil. As of the announcement, this benchmark price was around $90 per barrel. The decision to set a higher purchase price reflects the administration's response to the changing dynamics in the global oil market, balancing the need to replenish strategic reserves with fiscal considerations. This strategic procurement is part of a broader effort to ensure national energy security while navigating the fluctuating oil market.

Source: Reuters “US seeks to buy 6 million barrels for oil reserve by January”

Why it matters to EB5 Energy investors:

Our projections of 2.5 to 3.25 years repayment and $400,000 ROI per investor are based on an average oil price of $72/barrel.