U.S. oil reserve drops below 300 million barrels, raising cavern risks

The U.S. Strategic Petroleum Reserve has fallen below 300 million barrels for the first time since the early 1980s, intensifying debate over whether continued drawdowns could damage the underground salt caverns that store the country's emergency crude. Department of Energy data released Monday showed inventories falling as the U.S. releases 172 million barrels in response to supply disruption caused by the Iran war, with stocks expected to sit at about 243 million barrels once the drawdown is complete. Amos Hochstein, who served as a senior energy advisor to President Joe Biden, said levels near or below 300 million barrels risk harming the caverns and slowing the system's ability to respond to future shocks. Siddharth Misra, a petroleum engineering professor at Texas A&M University, said 70 million barrels may be the strict physical minimum to keep extraction pipes submerged, but placed the practical operating floor between 250 million and 300 million barrels because low inventories can raise operational and geological risks. The Energy Department disputed claims that the caverns are at risk of collapse, with Press Secretary Ben Dietderich saying they remain full as the oil-to-water ratio changes. Concerns are not new: Republican lawmakers raised similar issues after a record 180 million-barrel release in 2022, and a May report from the GAO (U.S. government watchdog) said repeated drawdown and refill cycles can distort cavern shape and reduce long-term viability even though most caverns were found in very good condition after the 2022 release.

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