Trump budget proposes 15 million barrel SPR sale, selloff of gasoline reserve

Washington — US President Donald Trump's proposed $4.8 trillion budget includes a proposal to sell 15 million barrels from the Strategic Petroleum Reserve and to selloff the 1 million Northeast Gasoline Supply Reserve.

The budget proposal, however, is widely viewed as an outline of administration priorities and is unlikely to be taken up by Congress.

The proposal calls for the Department of Energy to sell 15 million barrels of SPR crude to fund other agency priorities, including the environmental remediation of the Elk Hills Oil Field, previously known as Naval Petroleum Reserve No. 1, in Kern County, California.

As of January 31, the SPR held 635 million barrels of crude, including 384.7 million barrels of sour crude and 250.3 million barrels of sweet crude.

In 2017, the White House unveiled a proposed budget for the agency that included a "half-liquidation sale" of the SPR, selling an estimated 270 million barrels of crude from the reserve by 2027. The proposal was never taken up by Congress.

Similar to previous budgets, the Trump administration again proposes selling off the Northeast Gasoline Supply Reserve.

"The NGSR is very costly to maintain, has not been used for its intended purpose, and is not a practical solution for a severe supply interruption, as, for example, the reserve would only be able to meet one day's worth of gasoline demand in the Northeast States," the budget proposal states.

The Obama administration set up the reserve following gasoline shortages caused by Hurricane Sandy in 2012. It currently holds 700,000 barrels in New York Harbor, 200,000 barrels in Boston and 100,000 barrels in South Portland, Maine.

In 2015, DOE studied possible regional product reserves along the West and Southeast coasts, but the agency has since abandoned those plans.