The Trump administration announced a major development Thursday in its effort to stabilize energy markets, finalizing a sweeping agreement involving tens of millions of barrels of American oil as the ongoing conflict with Iran continues to put pressure on global fuel supplies.
The announcement comes as Washington works with international partners to address disruptions in the energy market, with rising gasoline and diesel prices becoming a growing concern for American households and businesses.
President Donald Trump has made energy security a central priority of his administration, particularly as military operations in the Middle East threaten international oil shipments and complicate efforts to keep prices under control.
On Thursday, the Department of Energy confirmed that private energy companies have agreed to borrow approximately 40 million barrels of crude oil from the Strategic Petroleum Reserve, completing the final portion of America’s commitment to a massive international emergency oil release.
According to Reuters, the department awarded contracts Wednesday for nearly 16.8 million barrels to several major energy trading and refining companies, including Gunvor, Trafigura Trading, Phillips 66 and Vitol.
The latest contracts follow an earlier round of awards on October 13, when the administration allocated another 23.8 million barrels to companies including Exxon Mobil, Atlantic Trading & Marketing and Macquarie Commodities Trading.
Together, the agreements complete the administration’s latest effort to move additional American crude into the market. The initiative is part of a much larger international agreement reached in March, when the United States committed to releasing 172 million barrels from its emergency stockpile.
Approximately 30 countries participating in the International Energy Agency agreed to coordinate the release of 400 million barrels worldwide in response to energy disruptions stemming from the war with Iran.
Unlike traditional emergency oil sales, however, the Trump administration has structured the transactions as loans.
Participating companies must eventually return the borrowed crude along with additional barrels, allowing the federal government to replenish its emergency reserves while collecting a premium.
The Energy Department says the broader exchange program will ultimately return more than 216 million barrels to the reserve, including approximately 44 million additional barrels valued at more than $4 billion.
“By securing the return of more than we released, we are strengthening America’s energy security and ensuring the Strategic Petroleum Reserve remains ready for the future,” Energy Department Under Secretary Kyle Haustveit said Thursday.
The returned oil is expected to begin arriving early next year. However, the emergency releases have also intensified concerns about the nation’s dwindling petroleum stockpile.
Federal data released earlier this week showed the Strategic Petroleum Reserve had fallen to approximately 282.6 million barrels, its lowest level since October 1982.
The latest oil agreements come just days before the November midterm elections, with energy costs remaining a significant economic concern for voters.
The administration maintains that its exchange strategy will help address immediate supply disruptions while eventually returning more crude to federal storage than was originally withdrawn.
