U.S. petroleum reserve is a versatile weapon


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    Strategic Petroleum Reserve oil is stored in underground salt caverns. This bottle shows how the crude floats on top of briny water.

    - frankrelle.com

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    As thrilling as it might sound (or at least it sounded to this reporter) to visit the Strategic Petroleum Reserve, the truth is when you get there there's not much to see. It's all hidden underground.

    - frankrelle.com

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    To go on site at the Strategic Petroleum Reserve you have to go through rigorous security, and guards patrol all during the visit.

    - frankrelle.com

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    The Strategic Petroleum Reserve at Bayou Choctaw is surrounded by swamp. Water birds and alligators make it their home.

    - frankrelle.com

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    Each salt cavern holds about 10 million barrels of crude oil, enough to fill 20 full-size tanker ships. All you see are these valves on the surface, surrounded by fencing and motion sensors.

    - frankrelle.com

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    Pipes carry crude oil into and out of the salt caverns at Bayou Choctaw, running half a mile under the earth.

    - frankrelle.com

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    A guard with assault rifle checks the area where oil would leave the Strategic Petroleum Reserve and head out into U.S. via pipeline.

    - frankrelle.com

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    The salt caverns hold sweet or sour crude oil. Sweet crude is more valuable, easier to refine into gasoline and other products.

    - Frank Relle

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    Suresh Sevak is the site leader for the Department of Energy at the Bayou Choctaw facility.

    - frankrelle.com

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    Sam Washington is a Department of Energy worker at Bayou Choctaw. He likes the charm of its swampy setting.

    - frankrelle.com

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    Robert Templet is a foreman at the Strategic Petroleum Reserve. He's worked there 35 years, and he loves being a "pump man" who gets the oil out to the people.

    - frankrelle.com
The U.S. created the Strategic Petroleum Reserve after the oil embargo of the 1970s. Blake Clayton at the Council on Foreign Relations says that was the first time America faced its utter dependence on oil and realized, "These kinds of oil shortages can wreak havoc on the national economy." The official goal of the reserve remains to keep oil flowing in case of emergency. "Not just when supply is low, but when that shortage means the national economy could actually be derailed." But the Strategic Petroleum Reserve has another, unofficial, function. The White House can tease the oil market with its 700 million barrels of sweet and sour crude, just sitting there. That's why you hear officials -- and the president -- constantly referring to the reserve in speeches as being "on the table." What they're really saying is: Don't forget, we can tap that crude oil any time we want. If they do tap the reserve, the extra oil on the market will make prices drop, right away. If oil traders bet on too high a price, they'll lose money when the U.0.S releases its reserves, and they know not the day nor the hour that could happen.
Watch a short video animation to see how the Strategic Petroleum Reserve works. For more on its history, read the backstory.
James Koehler with the Truman National Security Project says when President Obama put 30 million barrels on the market last June, "Prices did drop, futures prices did drop for about a week there, and then we were back up to where we were before." That's not a bad thing. The reserve is actually meant to stabilize oil prices. Koehler says, "Probably the strongest component of it is in terms of the threat to use it, rather than the use of it. Keeps people in check moreso than an actual release of oil." The Strategic Petroleum Reserve may be more powerful "on the table" than in the pipeline.

About the author

Eve Troeh is News Director at WWNO-FM in New Orleans, La., helping build the first public radio news department in the station’s 40-year history. She reported for the Marketplace Sustainability Desk from 2010 to 2013.

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