Strategic Petroleum Reserve: Possible Effects on Gasoline Prices of Selected Fill Policies [Updated September 27, 2004]   [open pdf - 52KB]

"Conditions in the gasoline market, including strong demand, high refinery capacity utilization rates, fragmented regional gasoline specifications, and scarce, high-cost imports, as well as the need to build inventories, point to the continuation of high gasoline prices even if oil prices decline somewhat. Although the price of oil influences, and is a component of, the price of gasoline, a complex interaction of many factors determines price. A drawdown of the SPR [Strategic Petroleum Reserve]- in addition to a deferral of RIK [royalty-in-kind] fill- is a further policy option, but is not analyzed in depth here. Benefits might vary, depending upon the ability of refineries to absorb additional crude, and the amount of additional crude made available. However, if one considers that refining capacity is already strained and unlikely to benefit from extra crude supply, any softening in oil prices from a drawdown would be unlikely to be passed along in full to consumers. This report will be updated as events warrant."

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CRS Report for Congress, RL32358
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