The US government should refill the Strategic Petroleum Reserve at a much faster pace in the interests of energy security, according to the chief executive of Hess.
The reserve, which was tapped to temper price spikes following the outbreak of the war in Ukraine, will take more than five years to be replenished at current rates, John Hess told the CERAWeek by S&P Global conference in Houston, Texas, on Tuesday.
Hess described those plans as a "token response" when there was an urgent need to fill up the reserves as quickly as possible.
"That's why I'm speaking out here because I think we are as a government asleep at the switch in terms of providing energy security," he said.
President Joe Biden's administration has lined up purchases of about 3mn bl of crude every month through July to partially replenish the SPR. That is part of the White House's plan to replace some of the 180mn bl of crude sold from the reserve in 2022 through emergency sales.
The SPR held 362.3mn bl of crude as of last week and is on track to hold nearly 400mn bl by the end of the year, after accounting for purchases scheduled through August and the upcoming return of nearly 20mn bl of crude loans. The SPR hit its maximum capacity of nearly 727mn bl in 2009.
The US has been able to pay for direct purchases of crude so far by using about $4.7bn in leftover revenue from the emergency SPR sales in 2022, which would allow for the purchase of a total of 60mn bl at the Biden administration's maximum targeted price of $79/bl. Refilling the SPR to its maximum capacity would require additional congressional funding.
