The SPR is the lowest since 1982, but days should be the big concern. 
According to the Energy Information Agency, the Weekly U.S. Ending Stocks of Crude Oil in the Strategy Petroleum Reserve (SPR) are at the lowest level since 1982.
Strategic Reserves Millions of Barrels
Strategic Reserves Millions of Barrels Detail
Reserves in barrels don’t accurately present the severity of the situation.
Strategic Oil Reserves Supply in Days
Dwindling SPR Rising Demand
Reserves are sinking while demand is rising. The lead chart tells this important story better than raw SPR numbers.
Supply in days is the volume of the SPR divided by product supplied, both numbers from the EIA.
Operation Epic Fury that kicked off the War in Iran was February 28, 2026.
At the start of war, the SPR has a supply of 20.9 days. The US now has a supply of 14.8 days.
Trump is using reserves to hold down the price of gasoline at the pump.
Do you think Iran does not understand these reserve numbers?
Crazy Talk
Talk of spending another month to secure the strait is crazy talk. We don’t have a month.
Besides, there is no guarantee that a month is sufficient timeline to secure the strait.
No Winning Options
Trump is fuming because he has no winning options. His best option was the MOU ceasefire that he just trashed.
Trump could have and should have bragged about what a great deal that was. Instead he reopened the war and does not know what to do with it.
So, here we are with two weeks of reserves and no oil flowing through the strait.
Grok on the Numbers
Related Posts
July 26, 2026: Trump Proclaims He Is Guardian of the World, Backs Off Escalation
Advisers worry the US is running out of missiles.
July 27, 2026: Real-Time Documentary Captured Senator Graham’s Push to Start War with Iran
A filmmaker followed Graham for 3 years covering visits with Trump and Netanyahu.
July 29, 2026: Iran Launches a Surprise Attack on U.S. Forces in Jordan
The war expands to Iraq with Ukraine on deck as Saudi Arabia retaliates with the US.
Iran launching a surprise attack is another piece of the puzzle. It shows Trump is lying when he says Iran is desperate for a deal.
Not only is the US running low on weapons, the SPR is down to two weeks supply.
Here is some additional SPR info.
The US Congress bipartisan Budget Act of 2015 mandated SPR sales of 58 million barrels from the SPR from 2018 to 2025.
The US Congress bipartisan Budget Act of 2018 mandated additional SPR sales of 30 million barrels from the SPR from 2022 to 2025.
The US Congress bipartisan Budget Act of 2022 mandated additional SPR sales of 100 million barrels from the SPR from 2022 to 2027.
These bipartisan budget acts were enacted because Congress thought the US SPR was not needed anymore thanks to the shale boom that brought US oil production from 4 mbpd to 13 mbpd. Congress felt the SPR was no longer needed and a source of funds. That’s a total of 188 million barrels.
In addition, Biden drew out 180 million barrels in 2022 in response to the Russian invasion of Ukraine.
Biden then authorized refilling the SPR with 200 million barrels. However congress only gave him enough money to add 59 million barrels before they cut off the funding. However, congress also stopped the remaining mandatory sales that had not yet happened from their 3 previous budget acts.(141 mb)
Trump likes to say that he filled the SPR, but he never added a drop of oil in his first term. The SPR actually dropped in his first term because of the congressional mandated sales.
Trump had an opportunity to add oil to the SPR when he began his second term. This would have been a good idea, considering he was about to attack Iran. But he didn’t.
Trump has authorized drawing out 172 million barrels, and has so far taken out 100 mb.
It is unknown how low the SPR can go. Most “experts” suggest 250-300 mb is the lowest the SPR can go before struggling to pump more out, and the possible collapse of the salt caverns. The Trump administration says it can go as low as 70 mb.
A few weeks ago we were drawing over 9 mb per week. This has now dropped to 7 mb per week, as the pressure is dropping as the SPR declines. As the SPR drops below 300 mb, it will be interesting to see how much can be pumped each week. We are going to find out soon if the SPR starts running into issues.
In addition to SPR draws, we are also drawing from commercial crude inventories and from refined product inventories. Commercial crude inventories are down to 411 mb, which is 6% below the 5 year average. Gasoline inventories are currently 6% below the 5 year average. Diesel inventories are 13% below the 5 year average.
Thanks. 70mb, yet 5-6 weeks ago he said we were 4 weeks away from running out. I wish someone would ask him about that.
Trump says a lot of things; usually to back up whatever position he is trying to justify at that moment. Like lowering pharma prices by 1400%, totally destroying Iran’s nuclear program, and winning the Iran war over 40 times.
He never said what oil he was talking about. People just assume he meant the SPR.
Anyway, while Mish made an educated guess on how many days of SPR is left, it is difficult to predict because as the pressure drops we draw out less oil each day. We are down to around 1 mbpd (from a max of 1.4 mbpd several weeks ago). As levels drop, this withdrawal rate will slow. And if we start getting cavern collapse, it will slow even more.
He actually referred to the reserves all over the world and stated, “You want to see bedlam?” But I agree, you have to take everything he says with a grain of salt.
Thanks Papa. This is what I was thinking too. Have we ever reached this low in SPR? Any expert estimate of when the storage becomes unstable and when we might have to stop drawing it down further? I highly suspect the capacity is on paper and that the hard limit is 10 days of oil in “storage” when we have to really stop drawing it.
This is the lowest the SPR has ever been drawn down to. The last time it hit this level was when we were first filling it. Which is why we are estimating how low it can go before complications. We won’t know for sure till it happens.
Oil execs had estimated July for the supply crunch, before the MOU was agreed to. So I guess the question is how much time was bought in those few weeks the ships were moving.
And how much is being slowed or cancelled by the Bab-el-Mandeb Strait issues?
excellent synopsis PapaDave
Thanks
My pleasure Mish. It’s a topic that I have a keen interest in.
Cushing just hit 18mb, operational floor is 20mb….is that bad? lolz
30-year Treasury yield at 19 year high….what, me worry?
How much if any of the 411 MBO inventories are pipeline fill and tank bottoms? If included, the percentage left to draw upon is much lower.
An excellent question. Best estimates are 250-300 million barrels of pipeline fill and storage tank bottoms in the US. Leaving roughly 110-160 mb of actual available crude oil.
One example is Cushing storage with a max of around 80-90 mb and a minimum of 18-20 mb.
Even before the drawdowns, the SPR could only pump at 60% of its designed rate. The more significant reductions in effective capability have come from aging pumps, piping, wells, and surface infrastructure. The Life Extension Phase 2 (LE2) program is trying to restore capability, but its schedule has slipped substantially from the original plan. Instead of all major work finishing by 2026–2027, DOE and GAO now expect the remaining work to extend into early 2028.
Good info. Thanks.
Pardon while I reach for my back to pat! Like now, in ~2004 I was a secular (at least longer than a normal cycle) refining bull. And I argues for “Days Inventory” as really supply had relevance when given demand (an absolute # is minimal info). And demand gets relevance compared to supply. And as an analyst I was in a numbder of publications on the topic; AND refining was the #1 subsector fin the S&P for the next 2 years. Later that decade the US DOE added those metrics for Oil and all the major Products.
Why/how did refining snap into a secular bull market? When Bush 2 became Pres in haste to do tax giveaways; and in haste and against industry advice he just gave a $4k to $8k tax CREDIT (sweet than a writeoff) to “vehicles up to 7k lbs. Industry advice was to make the credit for DELIVERY vehicles. But W in haste didn’t write that into the code.
So what happened in the economy from it? THAT IS WHEN HUMMERS BECAME A “THING” AND THE NEW HUMMER DEALERS WERE ADVERTISING FOR PEOPLE TO COME IN FOR “OVER $5K OFF A NEW HUMMER”. When that happened the US Avg vehicle mileage went down and gas went up until it crashed the Hummer market. (I was literally saying “I told you so”; and GM ignorance led to a boom to bust vehicle life of only a few years.
This time it’s several wars taking approx 6.5 M bpd of Global refining capacity down. (GS numbers).
Speaking of, a current BBerg headline: “Exxon, Chevron Warn Fuel Prices to Endure as War Knocks Refining”.
Something I’ve been pointing out for ~2 months now.
I can’t understand why anybody with more than two active brain cells can still support the Trump administration. No wonder the rest of the world thinks Americans are lazy and stupid.
We might empty the SPR before Netanyahu’s minimum time for Iran to get a nuclear bomb.
At the end of the day, it comes down to the Epstein Files.
Trump can’t afford for Russia or Israel to suddenly release the unredacted Epstein Files. Whatever must be done will be done. Fight wars for Israel, allow an innocent country to be slaughtered, collapse the US economy, no price is too high.
Trump has weathered multiple sex scandals including adverse court rulings after trials. I think his motivation for war and refashioning the world economy is instead, egotistically, to make his mark, to “sign his name” and brand on history and everything else. He wants to make the league tables like Alexander, Augustus, Lincoln. It is that deranged and shallow.
He wants to flood and displace everyone’s world with himself.
And MAGA still thought of nothing of such a Christian man who even put his name on a bible edition. 🙄
Make that a “Made in China” Trump Edition.
Found on internet: “…neither Trump nor the Israeli leadership care if they light the world on fire.
The evidence? They are lighting it on fire.”
The United States has never had the slightest interest in any deal with Iran, as there is no deal Iran can make that will satisfy Israel. The MOU was simply a ruse to enable the US to get as much oil out as possible, stabilize commodity prices, and load up to take another swing.
The goal ever always only was to turn Iran into a failed state at Israel’s behest, as was done to Iraq, Syria and Libya. The United States and Israel will not hesitate to go nuclear if that is what it takes.
Storage facility damaged following Biden draw down for political reasons.
Democrats are not America’s friend
Oh yeah, what;’s that alleged storage damage in comparison to this tiny war and world economic dislocation? Right.
Got any proof that the drawdown to 400 mb under Biden caused damage to the SPR? And if so, do you also have similar proof now that Trump has drawn the SPR down to 307 mb?
This is the important sentence from the article, “At the start of war, the SPR had a supply of 20.9 days. The US now has a supply of 14.8 days.”. So we lowered the SPR inventory by 5 days in 5 months. This does not mean we have 2 weeks left. It means we have 3 months left.
Oh well then, no worries.
Hormuz blockade has not been there for the full five months. I also suspect that there is an operational limit on how much we can actually draw from the SDR. We likely can’t draw out the last drop from it.
But everyone was contending that the Iranian Regime had closed the Strait and nothing was getting through!
Not sure why you think draws have been constant or will continue to be…
Especially in a volatile geopolitical situation with a second crisis in another strait.
If correct and I understand this the usable SPR supply is exhausted just before the midterms.
Decent post…should have gone into the dynamics and engineering behind the SPR a little and the structural risks of further drawndowns.
I have similar issues as I do not know much about the SPR physically, however I think the post is great with several very thoughtful replies. If SPR is truly a cavern(s), the pressure has different meaning than it would in a permeable rock reservoir. Pressure in a traditional reservoir is needed to move oil through the matrix opposed to a cavern or tank where the liquid seeks its open level. If the level is dropping significantly requiring more head by the pump to lift the oil from the cavern, then the problem can be solved by Increasing the frequency to speed the pumps. Higher RPM for a centrifugal pump increases the head but also requires more horsepower via additional current. Power supply and motor/pump need to be compatible, or the unit would need changing.
Second big issue I do not understand is the total damage that would be associated with a collapse. In Oklahoma, there is the suggestion that recent increase in earthquakes is the result of hydraulic fracture treating in matrix rock. The volume of the fracture is miniscule compared to a SPR cavern as a fracture treatment occurs over hours and typical fracture widths are minimal, on the order of a quarter inch or less, hardly a cavern. If a cavern collapsed, would we se an equal volume sinkhole at the surface and associated infrastructure damage, and a seismic event?
It seems to me there is more to the story.
We need a geologist to answer some of what you are bringing to our attention.
A drawdown of 300 million barrels is 300 million x 285 lbs – Huge by conventional standards, but in geological terms? Relatively trifling. That of course does not rule out a cavern wall collapse and destruction of pumping mechanisms in one or more of the disbursed caverns.
On a similar line of reasoning: I would not be surprised to see major tectonic activity in the Salt Lake City valley as the Great Salt Lake has shrunk dramatically in the past 30 years.
300 million barrels is plus 60 million cubic yards or 38,000 plus acre feet; that is significant. Probably more than most major landslides. That much volume and weight falling any distance is going to be felt for miles.
I do understand those metrics. But feeling a small shockwave for a few miles is relatively inconsequential ~ geologically speaking.
Size matters: The SPR is a network of 4 sites ranging in capacity of 38, 78, 247 & 300 million barrels. They are spread over two states (Texas and Louisiana). None of them are geologically significant.
Economically, it is a different story.
I do not think a sink hole forming over a period of time it takes for a cavern to collapse is geologically insignificant. Another issue is the collapsing material is falling into the remaining pool of oil. The collapsing earth is not going to be seal thus we can expect a significant portion of the oil to reach surface and pollute the ground water aquafer which will not be contained. That would be a disaster of unknowable cost to mitigate and clean up.
It is doubtful the studies detailing the potential possibility of collapse or any other research have delved into potential subsequent problems.
https://files.gao.gov/reports/GAO-26-106918/index.html
“DOE has found that the SPR’s caverns are generally in good condition and the majority have at least four remaining available drawdowns—meaning they require continued monitoring and assessment but are not an imminent operational concern. However, DOE is concerned about the integrity of the SPR’s wells due to a combination of aging, breaking, and single-entry wells that may limit access to the SPR’s crude oil at some sites. Sandia found in 2024 that well deformations are outpacing DOE’s ability to adequately reduce the risk of potential well failures with corrective actions at current resource levels. DOE has also flagged unmitigated high vapor pressure—which may seasonally limit the deliverability of the SPR’s crude oil—as a potential concern and is exploring the feasibility of various possible strategies to address this issue. Additionally, DOE also manages other ongoing risks to the SPR, including from physical security or cybersecurity threats and from major climate events (e.g., hurricanes).
Cavern integrity and availability. The SPR caverns that were built by DOE were designed to be geomechanically stable for up to five full drawdowns. Repeated partial drawdowns followed by refill can leach a single part of a cavern repeatedly, leading to undesirable shapes. After Congress directed DOE to begin conducting regular non-emergency mandated sales from the SPR starting in 2017 to help manage the federal budget, DOE tasked Sandia to provide a yearly update on the number of drawdowns each cavern had remaining since the caverns were being used regularly to withdraw crude oil. In May 2025, Sandia reported that the majority of the SPR’s caverns (47 of 60—about 78 percent) had at least four remaining available drawdowns as of the end of calendar year 2024, and all but one cavern had at least one remaining available drawdown.”
Low Strategic Oil Reserves + Winter = The Perfect Recipe For A Global Fuel Panic?Markets don’t break because they run out of supply.
They break because they run out of confidence.
Now imagine this headline flashing across every major news outlet:
“Government Admits Strategic Petroleum Reserve Has Fallen To Unacceptably Low Levels.”
That single admission could matter far more than the actual number of barrels remaining.
Why?
Because strategic reserves aren’t just emergency fuel. They’re psychological insurance. They tell markets that if something goes wrong, there’s a backstop. Remove confidence in that backstop, and the market begins pricing fear instead of fundamentals.
Now add one more ingredient.
Winter.
Demand for diesel rises. Heating fuel consumption accelerates. Freight companies need more fuel. Utilities burn more energy. Everyone begins asking the same question:
“Should I fill up now… just in case?”
That question is where the real problem begins.
History has shown that shortages are often created by expectations rather than physical scarcity. If millions of motorists decide to top off their tanks during the same week, gas stations don’t need to be out of fuel to appear empty. Long lines create viral photos. Viral photos create more panic. Panic becomes self-reinforcing.
The irony is almost cruel.
People rush to buy fuel because they fear shortages…
…and their rush creates the shortages they feared.
At that point, governments have little choice but to intervene.
Expect fuel rationing.
Expect restrictions on commercial purchases.
Expect emergency directives prioritizing trucking, agriculture, hospitals, and emergency services.
But intervention doesn’t stop there.
Governments would almost certainly enter global energy markets as buyers, attempting to rebuild depleted reserves before conditions deteriorate further.
And that’s where this stops being a domestic story.
China isn’t going to sit back while another nation secures available supply.
Europe isn’t likely to wait either—particularly if winter demand is already climbing.
Each government acts rationally.
Each government wants energy security.
Each government enters the market with billions of dollars.
Collectively, however, they’re all bidding for the same finite barrels.
Suddenly, what began as a confidence problem becomes a global bidding war.
Oil producers can’t simply flip a switch and double production overnight. Refineries already operate near capacity. Shipping bottlenecks don’t disappear because politicians hold press conferences.
Supply adjusts slowly.
Prices adjust immediately.
Higher fuel costs ripple through everything.
Freight becomes more expensive.
Food prices climb.
Manufacturing costs increase.
Inflation, which central banks spent years trying to suppress, returns through the front door.
The uncomfortable reality is that modern economies are still built on inexpensive, reliable energy. Remove confidence in that foundation and every sector begins repricing risk simultaneously.
None of this requires an actual global shortage.
It only requires enough participants to believe one is coming.
Markets have always been driven by psychology as much as supply and demand. In energy markets, confidence may be the most valuable commodity of all.
And once confidence disappears…
Events tend to move much faster than policymakers expect.
Good post!
Live for today. Worry about tomorrow when it comes.
Look at johnny Carsons late night joke about toilet paper shortages decades ago. We saw it raise up again with covid
That is absolutely great post!!
Why? It wasn’t clear form the article.
Is the sky falling? What is going to happen?
So Trump kept the price of oil relatively low for 5 months of on again, off again war using only 6 days of SPR capacity? Sounds like excellent management to me!
In addition to the SPR (308 of 714 mmbbl) there are commercial inventories (404 of 520).
“In addition to the SPR (308 of 714 mmbbl) there are commercial inventories (404 of 520)”
The SPR has 308 mb. Of that amount, roughly 230-250 mb is operational, and unavailable for use. That leaves 60 to 80 mb available.
Of the 404 mb of commercial, 250-300 mb is pipeline fill, and tank minimums. That leaves100-150 mb available.
Just as a reminder the December contract for oil is $75.00 a barrel. The future price of oil in a free market made by sophisticated oil trader with all the knowledge money can buy; not selected information made to pump the price of oil.
U.S. Ending Stocks of Crude Oil and Petroleum Products (Thousand Barrels)
Mar 07, 2025 1,594,870
Mar 06, 2026 1,682,368
Jul 24, 2026 1,526,350 4.3% less than Mar 06,2026
https://www.eia.gov/dnav/pet/pet_stoc_wstk_dcu_nus_w.htm Go look at the complete data just not the SPR data.
As you all will have noticed, prices at the pump are not moving proportionally to the gyrations of the oil futures prices. The crack spread was almost at $70 instead of around $30. The crack spread is roughly the mark up of crude for refining costs + profits.
The current crack spreads can be interpreted in various ways, but one would be that refiners are paying about $40 more for a barrel than the futures imply. How can that be? Futures are virtual barrels, not physical ones, and the ratio of long positions to inventories is very high, leaving many observers über puzzled as to what is going on.
Trump offers the simplest explanation: people downstream have conspired to weaponize Iranian narratives about Hormuz to gouge the end customer. 😜
That would be an incorrect interpretation.
Refiners pay the market price for crude and sell their refined products at market prices. Crack spreads are high because so many refineries are offline in Russia, the Persian Gulf and China, that there are global shortages of refined products.
The refineries are making huge profits. This can all be seen by looking at their financial statements.
You predicted oil would be close to $40 in December. Have you changed your mind?
Not even the oil traders perdicted April 20,2020 of negative $37.63 a barrel.
was anyone actually paid 37 and change, to purchase a barrel in futures markets
You’re in a hole and digging deeper. So are you now going to predict negative prices for December?
Anytime the price of oil doubles on the chart – it come back down and drop 50% of the increase.
1986 Counter Oil Shock
2008-2009 Financial Crisis
2014-2016 Shale Glut
2020 Covid Pandemic
This is the pattern. Let us do the math. $65 base – went to $115 difference is $50. Half is $25 and take from base. = $40.00 plus a little future contract mayhem and whalla $40. History, Charts and perdictable human behavior. Timing is a little more difficult – I will admit but what good is an outrageous perdiction with a time frame.
The problem is not predicting a price. It is predicting a price AND a date to go with it. Oil could indeed go to $40. But unlikely in December given the continued disruption in production and supply.
WW I & WW Eleven, our whole Nation sacrificed everything to Win those Terrible Wars
Biden selfishly sacrificed over half of the SPR
So the Democrats could win elections.
Sadly today, our Nation bitches, complains & whines about how it’s all Trump’s fault.
When a Nation that has slaughterd 100’s of its own citizens, & recently hanged a promising 19yr old Olympian Wrestler for his beliefs
A Nation hell bent on building Nuclear Weapons to start WW 3.
We as a Nation should be applauding, supporting & Praying for Trump for doing the right thing.
If our Nation didn’t sacrifice everything to
Win WW Eleven. Instead Bitched, Whined & Complained. You wouldn’t have had the freedoms today, to express your 1st Amendment… Think about that.
Therefore… every war is a good war and stop bitching, whining and complaining?
War is necessary at times.
Ya but we are talking about this war, and it was not necessary.
Trump’s pretext this time was all over the map. We suddenly had to draw the line here, why? 40+ years of them chanting “death to America” and steadily seeking nukes in this setting did not change. What changed? Maybe the perceived momentum of a certain anti-Iran nation’s recent massive campaigns in the Middle East? Trump loves a winner and hates a loser — hence his about-face (and lackey MAGA’s) on Ukraine-Russia. That kind of errant lunacy suddenly makes this war “necessary”? Only to one nation, for whom it was always “necessary,” for any sacrifice, expendable down to the last USA dollar and soldier, not to mention our economy’s fate.
Your and others mistake is allowing Trump to get in your head to the degree that you blame everything on him.
Trump did not prosecute this war as it should have been done. But that doesn’t mean that stopping the Iranian Regime from working on a nuclear weapon wasn’t the correct thing to do.
How many presidents US had in those 47 years ……. Only one was ……..
What a travesty !
Huh? Write in English please.
So is it true that Trump decided to go into this war?
People blame him for that, not everything.
“The illusion of freedom will continue as long as it’s profitable to continue the illusion. At the point where the illusion becomes too expensive to maintain, they will just take down the scenery, they will pull back the curtains, they will move the tables and chairs out of the way and you will see the brick wall at the back of the theater.”
― Frank Zappa
These quotes have the illusion of wisdom, but the quote never makes it explicit who the “they” are.
The US is wasting time and resources in overseas conflicts, National security should be built on domestic strength, specifically by securing our power grid and reducing global oil dependence. We have the technology, tools, solar, wind, advanced battery storage, nuclear power to make this happen.
We have the wrong people in place to make this happen.
here is a REAL example https://www.energy.gov/articles/nuclear-lifecycle-innovation-campuses-contenders-announced
Was that the guy who took a machete to a policeman?
Yes, let’s invade Sudan on the same basis
Illhan Omar enters the chat…
The only problems with your post is that Iran is not hellbent on obtaining nuclear weapons and startng WW3. You can tell that because they signed and abided by the JCPOA.
Secondly, when the USA was under no threat during WWI.
Finally, when you see “WWII” or “World War II”, the “II” isn’t eleven. It’s two Roman numerals which make it the modern “2”. So think of it as World War 2 (two) not eleven.
Other than those minor quibbles, you generally spelled everything correctly.
And you wouldn’t have the 1st amendment right to spread your lies and bullshit.
Almost none of this is actually true. MAGA is one sick, twisted, tortured LSD trip through history.
29 days was the SPR max? It should be 6 months.
How I hate all these warmongers. Every one, and they’re on both sides, should be punished, and their portfolios stripped permanently.
The SPR isn’t designed or intended to replace an entire day’s supply for the entire US.
There’s no way to simply shut off the vast output of the US oil industry.
So there’s no need.
It’s misleading to think of it in “days of supply”, the SPR is used to reduce/support the price of oil by selling or purchasing oil on the margins.
Before the SPR is empty, levels below 170 million barrels will cause irreparable damage to the SPR. When viewed in that light it is significantly worse than what Mish is presenting.
What will happen to oil prices if there is a major Gulf of Mexico Hurricane or Canada rightfully puts an export tariff/fee on the oil they sell us. By then the SPR will be nothing but pools of oil and salt sludge.
Trump is the poster child for FAILURE!
It would be a shame if the SPR salt caverns collapse. That would render them unusable in the future. If Trump withdraws all 172 million authorized barrels, the SPR will drop to 235 mb.
That’s a nice SPR you have there, be a shame if something happened to it….
Not sure I understand how the SPR operates. It seems beyond stupid to fill a cavern with oil when millions of barrels become unrecoverable. I must be missing something.
That’s a general problem with storage, whether tanks, or the SPR. It’s almost impossible to get back every drop you put in. Here is an answer from copilot.
🛢️ Why the SPR Can Never Be Fully EmptiedThe SPR is stored in large underground salt caverns, not steel tanks. These caverns behave very differently from surface storage:
1. Cavern Stability Requires a Permanent Oil CushionSalt caverns are kept pressurized with crude oil. If you remove too much:
This minimum volume is called the cavern heel or cushion oil. It must remain in place permanently.
2. Pump & Pipeline Hydraulics Require Minimum VolumeJust like Cushing tanks, the SPR’s pumps need a certain hydrostatic head to operate. Below that:
This creates a hard operational floor.
3. Aging Infrastructure Has Reduced Drawdown CapabilityA recent Government Accountability Office (GAO) audit found:
This means even beyond the natural cavern heel, additional barrels are trapped because equipment cannot safely access them.
Thank you for the explanation. Obliviously I’m not an engineer but I’d think they’d have a better answer to store millions of barrels of oil. My guess is this was the cheapest method to store large amounts of oil and the loss of oil is compensated by the cost of storage savings? Please say it’s not because they’re just plain stupid.
It actually is the best answer. Again, from copilot.
he SPR was put in salt caverns instead of steel tanks for three fundamental reasons: cost, security, and geology.
Salt caverns are dramatically cheaper, naturally secure, and already existed along the Gulf Coast when the U.S. needed emergency storage quickly after the 1970s oil shocks.
Below is the full breakdown.
🛢️ Core Reason
Salt caverns provide the lowest‑cost, safest, and fastest way to store hundreds of millions of barrels of crude oil for decades.
They cost up to 10× less than above‑ground tanks and 20× less than hard‑rock mines, according to the Department of Energy.
🧱 1. Massive Cost AdvantageBuilding enough steel tanks to hold ~700 million barrels would have been astronomically expensive.
Salt caverns are created by solution mining (injecting water to dissolve salt), which is far cheaper than constructing tank farms or excavating rock.
DOE explicitly states:
This single factor made caverns the only viable option for a reserve of this size.
🔐 2. Natural Security & ProtectionSalt caverns are hundreds to thousands of feet underground, providing:
A cavern is so large that Chicago’s Willis Tower could fit inside with room to spare.
This natural shielding is impossible with tank farms.
🌎 3. Ideal Gulf Coast GeologyThe Texas–Louisiana Gulf Coast sits on enormous salt domes, making it one of the few places in the world where:
The SPR needed to be connected to the U.S. refining network.
The Gulf Coast already had:
This made the region the only logical location.
⏱️ 4. Speed After the 1970s Oil CrisisAfter the 1973–74 OAPEC embargo, the U.S. needed emergency storage fast.
DOE acquired existing salt caverns first because they were already in use by the petrochemical industry.
This allowed the U.S. to store the first 250 million barrels rapidly.
Building tank farms would have taken years longer.
Is it really cheaper if you can’t access 25% of what you store? If you store 400 mb and you effectively lose 100 mb, at $80/ barrel it is costing you $8 Billion.
Yes. It is still much cheaper. Above ground storage tanks also have minimum operating levels where 25% of the oil is unavailable.
Using Cushing tanks as an example: 80-90 mb total capacity; 18-20 mb minimum operating levels.
The difference is that above ground tanks are filled to 100% and emptied to 25% many times per year. The turnover rate at Cushing is 8-12 times per year.
Every above ground tank is like this. You realize when you build one that the first 25% of oil you put in is part of the cost of construction because it is not available for use.
The SPR is supposed to be rarely used.
Thanks great explanation. I’ve learned something today.
And “we” elected this failure. I have even heard die hards say that we failed him. But perhaps the fever will yet break.
The quasi-religious desire for a magical savior and psychological daddy will not go away any time soon. It is also rooted in the ‘energy conservation” (mental laziness) of deferring to same.
Many a people have handed away their fate to such a fraud.
Since the birth of humanity. Before modern day science say 1600 I might understand the need for protection by the gods or rulers. But in the 21st century, ya gotta be kidding.
Hamas has confirmed that it has reached a deal over the decommissioning of its weapons after Donald Trump announced an agreement for the militant group’s “complete disarmament,” calling it a critical step toward a new Palestinian government in Gaza.
In a post on Truth Social, the US President said: “Today, the Board of Peace Reached a HISTORIC Agreement for the COMPLETE DISARMAMENT of Hamas and All Other Armed Groups in Gaza.”
(Israel has not respond)
https://www.abc.net.au/news/2026-07-31/trump-says-gaza-deal-on-disarming-hamas-israel-withdrawal/106980528
Watch Israel step up the genocide in response.
Does the Board of Peace include representatives from Hamas ?
Another lie.
The only surprise here is that anyone thought Trump would do anything other than what he has done. He is a vicious but not smart man.
He knows how to cultivate toadies…. probably is the best ever at it.
Stalin was pretty incredible. He could eat a Trump for breakfast.
A favorite quote (his idea of a joke), on Stalin’s greeting a subservient “comrade”: “What, you haven’t been arrested yet?”
Obviously not! They’re all turban clad dervishes who worship the moon god or something! Dumb as rocks, each and every one of the mullahs! They don’t stand a chance! We’ll win any day now! We’re doing great! We’ve already won several times! The DOW is over 50,000! This is a new golden age and anyone who can’t see that is insane or something!
And Iranians don’t understand that bombing the Usonian bases in their vassal states won’t result in anything, because the US will just pile their war machines in Israel and Iranians would never think of striking the stockpile with their hypersonic missiles. No, my dear sir.
When push comes to shove and the Iranians face total destruction and genocide the USA/Israel may experience their full and most brutal reprisal. Their war with Iraq shows what they may be capable of in regards to chemical and biological warfare. They may not need hypersonic anything.
“U.S. crude oil production reached a record high of 13.6 million barrels per day in July 2026, according to the U.S. Energy Information Administration (EIA). When including natural gas plant liquids and other petroleum liquids, total U.S. oil production averaged 23.6 million barrels per day in 2025.”
The math is complicated by the fact that not all daily use is from the SPR.
What will most likely break is imports from countries that have little SPR, and are supplying wares to the world.
You can’t run cars or diesel truck or jet liners on natural gas liquids.
It really seems discordant that the reserve is 2 weeks from empty, yet Yahoo say Crude oil sells for only $82/barrel.
Plus we export 4 mbpd of our light shale oil while our refineries import 6 mbpd of heavy crude which they were built to use.
US production is super-light liquids, but our refineries are set up to refine heavy crude. The SPR is heavy crude. You use heavy crude to make diesel, aviation fuel, fertilizer and a host of plastic and chemical products. You mix the super-light with heavy to make gasoline. We massively export our super-light around the world and massively import heavy crude, mostly from Canada. The problem is that our massive production of super-light doesn’t help in the loss of world-wide reductions in heavy crude production, which middle eastern oil is. Venezuela produces heavy crude which is now being shipped directly to US Gulf Coast refineries. But Venezuela’s production facilities have been decimated by decades of US sanctions.
Correct.
PapaDave, what do you think would happen if Canada stopped selling oil to the US?
First: I doubt Canada would stop selling oil to the US.
But IF they did, it would hurt both countries immensely.
It would cause gasoline and diesel shortages in the midwest as almost all the oil used in the 26 PADD 2 refineries comes from Canada. So many impacts to think about.
Here is an answer from copilot:
If Canada cut off crude exports, PADD 2 refineries would face an immediate and severe feedstock crisis because Canadian crude supplies up to 73–94% of refinery input in the northern Midwest. They have almost no alternative heavy‑oil supply, so throughput would fall sharply, margins would collapse, and fuel prices would spike.
—
🇺🇸 Why PADD 2 would be hit hardest
Canadian crude is the backbone of Midwest refining. In 2024, Canadian crude represented 100% of total imports into PADD 2 and 73% of net refinery input in the northern tier Stillwater A…. Many refineries are specifically configured for heavy Canadian grades (WCS, Cold Lake, Lloydminster) and cannot easily switch to light shale oil without major operational penalties.
Key structural dependencies
• ~2.5 million b/d of Canadian crude flows into PADD 2 via Enbridge Mainline and Keystone RBN Energy.
• ~2 million b/d of this is heavy crude with no viable substitute in the U.S. market atb.com.
• Heavy‑oil‑optimized refineries (Marathon, BP Whiting, Phillips 66, Cenovus Lima, etc.) rely on Canadian crude for coker and hydrocracker utilization.
—
🔥 Immediate impacts if Canada shut off supply
1. Refinery throughput collapse
Most PADD 2 refineries would be forced to cut runs dramatically because:
• U.S. shale (Bakken, Permian) is too light for their equipment.
• Heavy crude from Mexico or Venezuela is either insufficient or geopolitically constrained.
• Reconfiguring units takes months to years, not weeks.
Expect 20–60% throughput reductions depending on refinery configuration (inferred from heavy‑oil dependency data).
2. Gasoline and diesel shortages across the Midwest
PADD 2 produces a large share of U.S. inland fuels. Reduced output would cause:
• Regional rack price spikes
• Increased draws from PADD 3 (Gulf Coast)
• Higher transportation costs due to pipeline constraints northbound
3. Massive margin compression for refiners
Heavy‑oil refineries earn margins by upgrading cheap heavy crude. Without it:
• They lose their competitive advantage
• They must run expensive light crude at lower efficiency
• Some units (cokers) become uneconomic to operate
4. Cushing storage dislocation
Cushing, Oklahoma — the hub for WTI pricing — would see:
• Surplus light crude backing up
• Shortage of heavy crude
• Volatile spreads between WTI and heavy grades
—
📉 Longer‑term impacts (months to years)
1. Refinery closures or major reconfiguration
Some northern-tier refineries could face shutdown without Canadian heavy crude.
Reconfiguring to run light shale oil requires:
• New distillation units
• Different hydrotreaters
• Coker modifications
These are multi‑year, multi‑billion‑dollar projects.
2. Fuel price inflation across the U.S.
Midwest shortages ripple outward:
• PADD 1 (East Coast) relies on Midwest product flows
• PADD 3 would need to backfill, raising Gulf Coast prices
• National gasoline/diesel averages would rise
3. Canadian producers would also suffer
Because most Canadian exports are pipeline‑locked into the U.S., producers have limited ability to redirect volumes quickly atb.com.
That’s going to make it really hard to convince voters in November to “stick with the plan”.
September-October will be desperate times.
Shit and fan will be as one.
Gosh, that’s interesting, because when gas was at all time LOW prices during Trump 45 …he wanted to fill the reserve … but the left accused him of supporting his oil buddies and stopped it. Now gas is expensive and it’s Trump’s fault for not filling the reserve. Hmmm.
As Columbo said many times, “Just one more thing”.
Why is gas expensive Mike?
I’m sure you’re looking for a 4 word answer like “because Trump is horrible”. It’s not that simple. Yes, the Iran war is having an impact, but it is still cheaper than Biden gas. The Ukraine war is having an impact, but it is still cheaper than Biden gas. If you listen purely to Mish … you will think Trump inflation is far worse than Bidenflation … but there are actually a whole lot of issues in play.
As we all know, Biden intentionally started the COVID-19 pandemic just like how Trump started the Iran war! You really are a genius Mikey!
Ah, strawman much. Biden was not president at the time. Did Fauci and his Gain of Function research play into it … possibly … but that would not have anything to do with Biden … but as long as you are arguing in your own head, I’ll leave you to it.
Ah Yes, the Trump is better than Biden stupidity as opposed to they are both idiots which any reader would know has always been my position.
They were/are both too old! The minimum age to serve as POTUS is 35 yo. Would it be too much to set a maximum age of 65 yo? Today there are about 110M people in the US that are between 35 and 65. We can’t find even one from that group capable of serving as POTUS?
You’re fighting tribalism, Mish…always a “high lift”.
If we didn’t participate in the commodity repricing of oil on every fear, then our gas prices would be no different today than they were 6 months ago!
OUR costs to produce oil and gas has not changed in 6 months. Back then the price of a barrel of oil was around $60. It should be the same today.
Thanks for the negs but no one seems capable of telling me why this is wrong.
MikeC711,
Oil prices peaked under Biden because of Trump’s COVID19 policies. When everyone went to work from home, they didn’t drive nearly as much. Gasoline consumption crashed, and oil production with it. A massive number of wells were shut-in and fracking almost came to a standstill. It took years to restart full production which began after Biden called an end to the pandemic and reopened the country. Gas prices went well over $5.00 in many parts of the country.
By the end of his term, Biden had gas prices at $2.58/gallon.
Absolutely, it had NOTHING to do with cancelling leases and telling people who considered investing in fossil fuels … that the gov’t was doing everything in its power to shut them down. I love investing in industries that gov’t has promised to work against.
None of that mattered. You can tell because prices collapsed back to normal within 1.5 years of their peak in 2022, and the US was producing record amounts of crude at the end of Biden’s term.
LOL. When has ANYthing EVER stopped Trump from doing ANYthing he wants to do??!!
So he made his plans clear and Schumer and company went ballistic and accused him of paying off his oil buddies. Gas was lower than it had been for over a decade (less than $1.50/gallon). I could go back and find the articles, but doesn’t seem like the facts are going to sway you here.
Pathetic excuse. If Trump really wants to do something, he does not allow ANYTHING to stop him. Not even US law.
Or your ankle-biting.
Melania has had any of that funny business in many, many years.
Everyone can read the charts
2017 to 2020 (Trump 45) was a steady drawdown, not level, not adding
who was authorizing that?
Was it Biden or was it Obama?
So are you claiming you never read the news and that you don’t know about Trump’s attempt to replenish with gas at historically low values and the democrats going ballistic and claiming he was paying off his oil buddies? Are we really going to deny reality to push this one?
If, through the democrats’ fault, the SRP was woefully low, why did he break all campaign promises and start this illegal, unconstitutional, immoral and criminally stupid war?
To distract from his starring role in the Epstien files.
It worked amazingly well.
the one and only correct answer. operation epstein fury
Bullshit! Trump could and should have bought oil to fill the SPR during covid. But he did not, because he is simply not that smart.
He was busy calling covid a hoax and telling people to treat it with horsey medicine and bleach.
How did those Trump tariffs work out? Did they pay off the debt? Where is your $5,000 check?
Face it ~ Trump lied to you and you swallowed it, hook, line and sinker.
Uh, Ivermectin is not just horsey medication pal. It has been safely given to humans about 4 billion times. If assholes like WHO and Fraudci want to preclude doctors from prescribing it to treat COVID because it undermines the rationale for rushing the “vaccine” clot shots to market, and then the market starts using horse dewormer as a substitute because it’s active ingredient is ivermectin, that’s just an example of capitalism breathing through the regulatory loopholes, to borrow a concept from Ludwig von Mises.
To your point, we had a sort of underground railroad of Iver back during C19 times in our area. Many people saved… Including my wife… All done cheaply, BTW. Injectible 1% solution from veterinary supplies consumed orally… Very inexpensive. Sneering mentioners of horse paste have no idea what they’re talking about. Such a crime committed against a so-called free people.
1% solution…any other ingredients to avoid or look for?
What dosing did people use?
America’s Frontline Doctors had protocols out on http://www.flccc.net, I don’t know if they are still there. Dosing was by weight. You had to use only ivermectin solution, no dips or formulas to fight flukes or other parasites in livestock, just ivermectin. The taste was kind of sickeningly sweet, but not revolting. Given early in the infection it really seemed to knock it down quickly. Not for everyone but it was another tool in the kit. I took it using their prevention protocol. Never had Covid so I ended up respecting what the Frontline docs were doing.
A pinch of stupid and a dab of dumbass.
I remember something about bleach
It was a Trump mouth off musing about sterilizing inside the body…sort of a “kinda like bleach”…I don’t have that exact quote. But Trump misquotes a lot and his enemies are just as happy to misquote back.
Someday your kookery will earn you your Darwin award.
Again, you have no clue. Go ahead and follow the politicized science. It’s a semi-free country.
Show me your “science”, I could use a good laugh.
Tenacious gets it 👍
Thank you JP
Still with the kookery….
Ivermectin is safer than aspirin or Tylenol by a wide margin.
Based on a Japanese plant.
It is the most successful anti-parasite remedy ever.
Covid is a virus, not a parasite.
Viruses are best slowed or stopped from replicating by getting zinc into the cells of the body. When a virus attempts to replicate itself in the presence of adequate or excess zinc, the zinc bonds to the second bonding site in the DNA chain and stops the virus from replicating itself.
Ivermectin has no effect on a virus.
Unfortunately, zinc is a +2 ion and does not cross the cell wall easily. Zinc needs an ionophore to cross cell walls.
Many ionophores are available if you know cellular biology or study virology.
That’s what they want you to think! Covid is really tiny worms!
Brain worms, RFK jr had/has them.
😉
You forgot the sarcasm emoji.
Ivermectin: an award-winning drug with expected antiviral activity against COVID-19
https://pmc.ncbi.nlm.nih.gov/articles/PMC7539925/
Ivermectin is more than just an anti-parasitical, it is also a protease inhibitor, which interrupts the reproductive process in viruses. That’s apparently the mechanism which helped on C19.
Quercetin is a good one. Also green tea (EGCG).
“He was busy calling covid a hoax and telling people to treat it with horsey medicine and bleach.”
Inform yourself.
Ivermectin: an award-winning drug with expected antiviral activity against COVID-19https://pmc.ncbi.nlm.nih.gov/articles/PMC7539925/
WSJ on Fauci
https://www.youtube.com/watch?v=lBZ8JUO0aLc
Covid was a huge hoax
So horse paste cures hoaxes?
dont forget adding trillions of dollars to the money supply and then blaming biden for the inflation — always a delay between cause and effect
Mike figured out who it was who shit Trumps pants.
roflmao.
https://oilprice.com/Energy/Crude-Oil/Trump-To-Sell-Half-The-Strategic-Petroleum-Reserve.html
here is trump proposing to sell half the reserve in 2018
So what? Tell us what law the Democrats had passed to stop Trump from refilling the SPR? I’ll be munching popcorn on my lawnchair while I wait…
The democrats can’t do shit, and you know it.
The day of the election, Biden had gas down to $2.65 at my local Shell Station. Today it is $4.39. Thank Trump for every cent of the increase of $1.74 per gallon. Those are the simple facts.
The only reason gas got so cheap during his first term is Trump brought the economy to a standstill during Covid and supplies overwhelmed demand. Then when the economy opened up again under Biden supplies became tight because so many wells had been shut in.
Sorry the facts do not align with your MAGA cult nonsense.
Trump is economically illiterate.
Trump is economically illiterate, yes, but no president sets gas prices.
Set prices? No, but influence via policy or intentional war? Yes…
I’m sure it had nothing to do with leases, removal of regulations and such … just Covid. Got it. So you’re with the 2 word answer for why gas prices have climbed: “Because Trump!!” Loveit.
Reality check:
Most of our increased production had/has to do with the completion of infrastructure to transport oil and gas products to market. This incudes the compressor trains for LNG and the pipelines that they use to be filled.
When Natural Gas is produced and exported it synergistically allows for more higher (higher value) crude oil production.
When leases were offered in the Alaska wildlife refuge, there were no bidders. Regulation did however force the building of natural gas pipelines to stop the outrageous amounts of flaring or venting of gas that previously occurred.
You can of course believe whatever you want.
Yes always a delay between cause and effect
Correct, during the Biden administration permits were issued for over 20 billion cu ft/day of LNG export facility construction for a total of 43 billion more export capacity per day. We exported 135 billion cu ft last week for an average of 19.29 billion per day. Permitting has not been a problem in the oil industry despite all the rhetoric about regulation of the industry.
Several projects remain on hold for economic viability, and permitting is proceeding as needed.
If anything, regulation has encouraged exports and profits for the oil industry.