U.S. offers 40 million barrels from strategic reserve as diesel tops $6

September 29, 2026 at 11:20 PM2 min

This digest was compiled by AI from multiple sources — links to the originals are below.

The U.S. Department of Energy will offer 40 million barrels of crude from the Strategic Petroleum Reserve as fuel prices remain elevated nearly seven months into the Iran war. The barrels will be offered through an exchange, marking the final tranche of the 172 million barrels pledged to the IEA-coordinated emergency release. The SPR ended August with 286.6 million barrels, more than 445 million below capacity.

Key Facts

The U.S. Department of Energy will offer 40 million barrels of crude from the Strategic Petroleum Reserve through an exchange.
The SPR ended August with 286.6 million barrels, more than 445 million barrels below maximum capacity.
U.S. diesel prices have climbed above $6 per gallon, while gasoline remains above $4 per gallon.
Distillate inventories were 14% below the five-year average at the start of September, and gasoline inventories were 6% below normal seasonal levels.
Bids for the exchange are due October 6, and the program is expected to return roughly 200 million barrels to the reserve.

Emergency Release Details

The 40 million barrels represent the final tranche of the 172 million barrels the United States pledged to the IEA-coordinated emergency release. The barrels will be offered through an exchange, not an outright sale, requiring companies to return oil later with additional barrels as interest. The Department of Energy has said the exchange program will ultimately return roughly 200 million barrels to the reserve. Bids are due October 6, shifting crude into the near-term market with participating companies obligated to return larger volumes later.

Reserve Levels and Constraints

The SPR ended August with 286.6 million barrels after another 3.1 million barrels left the reserve during the week ending August 28. That left the reserve more than 445 million barrels below maximum capacity. Federal law restricts non-emergency drawdowns once SPR inventories fall below 252.4 million barrels. A 1981 Government Accountability Office report advised against releases below 250 million barrels except during a “very severe emergency.” The reserve is expected to fall to its lowest level since 1982 once the latest release is completed.

Fuel Market Pressures

U.S. gasoline remains above $4 per gallon, while diesel has climbed above $6 per gallon amid tight middle-distillate supplies and disruptions tied to the Iran war. At the start of September, distillate inventories were already 14% below the five-year average, while gasoline inventories were 6% below normal seasonal levels. Commercial crude stocks had fallen by more than 48 million barrels over the previous 20 weeks by September 1, even as emergency barrels continued moving out of the SPR. Energy Secretary Chris Wright pressed European countries to make good on their own emergency-stock commitments, saying several IEA members had released only a fraction of what they pledged.