US Strategic Reserve at lowest since August 1983 - KFYR

US Strategic Reserve at lowest since August 1983

(KFYR) - The United States’ strategic crude oil reserve is at its lowest level since August 1983, according to the U.S. Department of Energy.

Eugene Graner, veteran commodity analyst and president of Heartland Investor Services Inc., says this means if something happened to oil production in our country, we would only have 19 days’ worth of supply.

Graner says the strategic reserve has been used politically in order to hold prices down, but now the government has had to stop drawing from it.

Graner says the only way this can improve is by adding to the reserve, and to do that would compete with consumer demand for oil.

He says in our country, we only produce a little over 12 million barrels a day, but we use 19 million barrels. He says recharging it is a very difficult situation right now, and says either it’s done with increased U.S. production or by increased imports.

“The importance for the average consumer to understand here is, if nothing goes wrong with U.S. production and the imports that we have to have to maintain our usage, we are okay. But if something goes wrong, we are not okay. We have been living in a world where it seems like everything goes wrong eventually. And so, this strategic reserve thing is a big deal,” said Graner.

Graner believes the strategic reserve being left at the 19-day emergency level means the prices will be heading higher, and that re-filling the strategic reserve is unlikely in the foreseeable future.

He adds the reserve was created for national and economic security so that we would never have to deal with large spikes in oil prices. He says we have put ourselves in a situation where someday we could see prices doubling for gasoline.

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