The US Energy Department has authorized an emergency exchange of as much as 4 million barrels of crude from the Strategic Petroleum Reserve as Hurricane Isaias disrupts energy operations along the Gulf Coast.
The authorization allows ExxonMobil and BP American to receive up to 2 million barrels each, according to The Economic Times, which cited AFP. Energy Secretary Chris Wright said the crude is intended to help the companies maintain refinery operations while storm-related supply problems persist.
What the emergency exchange means
The transaction is an exchange rather than a permanent sale from the reserve. ExxonMobil and BP must return the crude in 2027 and contribute an additional premium amount beyond what they borrow, the Energy Department said.
The 4-million-barrel figure is a ceiling on the authorization, not confirmation that the full amount has already been delivered. The same applies to the 2-million-barrel allocation available to each company.
The Associated Press separately reported that the department authorized emergency crude exchanges to address storm-related supply disruptions.
Gulf production remains constrained
The move comes as offshore energy production begins a gradual recovery from Isaias. Reuters reported that about 69% of oil output and 57% of natural-gas production in the US Gulf of Mexico remained shut on Saturday. Some 113 production platforms—about 30% of the Gulf total—were still evacuated.
Shell had begun returning personnel to several Gulf assets, while Chevron was also redeploying crews and working to restore full production. Those efforts were expected to continue through Sunday.
Isaias made landfall in Florida as a Category 2 hurricane before weakening, but flooding, wind damage and power outages continued across parts of the Southeast. The reserve exchange gives the refiners temporary access to crude while offshore production and related supply routes recover.
