The Department of Energy (DOE) is planning to buy 1 million barrels of oil from U.S. companies after funding to make a larger purchase failed to pass Congress.
A notice posted by the agency Wednesday calls the purchase “a test” for the Strategic Petroleum Reserve, a national stockpile President TrumpDonald TrumpCheney says a lot of GOP lawmakers have privately encouraged her fight against Trump Republicans criticizing Afghan refugees face risks DeVos says 'principles have been overtaken by personalities' in GOP MORE in mid-March said he would fill “right up to the top.”
The 1 million barrel purchase would be a far cry from the 77 million barrels of space within the reserve. Doing so would have required $3 billion in funds, which Congress did not appropriate as part of the CARES Act stimulus package.
The effort comes as oil prices have fallen to historic lows due to a lack of demand and a lack of storage space for an oversupply of oil.
Democrats have repeatedly spoken out against any effort to assist the oil and gas industry during the coronavirus pandemic.
“Using federal assistance — including low-interest loans, royalty relief, tax breaks, or strategic petroleum reserve purchases — in order to prop up oil companies would be a wasteful misuse of government resources that would exacerbate the climate crisis,” Sens. Bernie SandersBernie Sanders Texas House Republican tests positive for coronavirus in latest breakthrough case In defense of share buybacks Progressives seething over Biden's migrant policies MORE (I-Vt.), Ed MarkeyEd MarkeyWarren, Bush offer bill to give HHS power to impose eviction moratorium Overnight Energy & Environment — Presented by Climate Power — Senate Democrats ding Biden energy proposal Six Democrats blast Energy Department's uranium reserve pitch MORE (D-Mass.) and Jeff MerkleyJeff MerkleyOvernight Energy & Environment — Presented by the League of Conservation Voters — Senate Finance chair backs budget action on fossil fuel subsidies Top Democrat says he'll push to address fossil fuel tax breaks in spending bill Democrats revive filibuster fight over voting rights bill MORE (D-Ore.) wrote in a letter to the president when the idea was first floated.
In April, DOE announced it would instead rent 23 million barrels of storage space in the reserve, allowing companies to pay for the space in oil.
The 1 million barrel purchase would be open to small and mid-sized oil and gas companies. The Federal Reserve Board also tweaked its Main Street Lending Program to be accessible to the same size oil companies.
Energy Secretary Dan Brouillette told Bloomberg TV on Wednesday that he and Treasury Secretary Steven MnuchinSteven MnuchinThe Hill's Morning Report - Presented by Alibaba - Biden jumps into frenzied Dem spending talks Former Treasury secretaries tried to resolve debt limit impasse in talks with McConnell, Yellen: report Menendez, Rubio ask Yellen to probe meatpacker JBS MORE were asked by President Trump “to evaluate the programs that were passed by the Congress and ensure that there is access for these energy industries to those programs.”