Saudi oil attacks: Why does the US hide oil underground?

A huge volume of oil is stored in caverns beneath Louisiana and Texas GETTY IMAGES

All members of the International Energy Agency have to hold the equivalent of 90 days’ worth of petroleum imports, but the US stockpile is the largest emergency store in the world.

The reserve’s website says that on 13 September there were 644.8 million barrels of oil held in these caves.

According to the US Energy Information Administration, Americans used 20.5 million barrels of petroleum a day on average in 2018 – meaning there’s enough oil to keep the country going for about 31 days.

Physical constraints mean only a small amount of oil can be moved from the caves each day, meaning even if there is presidential authority to release oil it would take nearly two weeks to hit the markets.

Moreover, the oil is all unrefined. It would need to be processed into fuel before it would be useful for cars, ships and airplanes.

US energy secretary Rick Perry told broadcaster CNBC on Monday it was “a little premature” to talk about breaking into the reserve yet in the wake of the attacks in Saudi Arabia.

But the usefulness of keeping such a huge reserve at a time when US energy production is booming has been questioned. Some in Washington have even recommended getting rid of it completely.

A report by the Government Accountability Office suggested just that in 2014, saying it could lower prices at the pump for US consumers. In 2017 the Trump administration mooted selling off half the stockpile to help tackle the federal deficit.

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Article URL : https://www.bbc.com/news/world-us-canada-49720026