The United States is about to release over 100 million barrels from its oil reserves, with the first batch reportedly amounting to 45 million barrels.

Questioning AI: Is releasing oil reserves a short-term painkiller or a key variable in trend change?

As conflicts in the Middle East continue to push energy prices higher, the U.S. has begun to utilize its Strategic Petroleum Reserve (SPR).

After the U.S. stock market closed on Friday, Eastern Time, media reports citing informed sources said the U.S. government plans to release about 45 million barrels of crude oil from the SPR in the first phase, aiming to curb rising fuel prices.

This action is a “preemptive move” within the total emergency release plan of 172 million barrels of SPR, and also part of the global release plan announced last Friday by the International Energy Agency (IEA). Against the backdrop of supply disruptions and geopolitical risks, the market is closely evaluating: is large-scale use of strategic reserves a “short-term painkiller,” or a key variable that could change the trend of oil prices?

Based on the information disclosed this Friday, the first batch released by the U.S. accounts for approximately 26% of its planned total release.

Last Friday, the IEA announced that its 32 member countries had agreed to release a total of 400 million barrels of strategic oil reserves. This is the largest collective release in IEA history. After the Russia-Ukraine conflict in 2022, IEA members released about 183 million barrels twice, but this time the scale has doubled.

Later on Friday evening, the U.S. Department of Energy confirmed that, as part of the IEA-coordinated global effort, the U.S. plans to release 172 million barrels of SPR to respond to oil price increases triggered by U.S. and Israeli airstrikes on Iran. Based on the scheduled release rate, the U.S. expects the process to last approximately 120 days.

Wallstreet.cn later pointed out that the U.S. release is significantly delayed. After the president issues the release order, the Department of Energy needs about 13 days to conduct bidding, award contracts, and begin delivery. Then, crude oil must be transported via pipelines or tankers to refineries and end-user locations. Even with immediate action, the oil reserves would only start entering the market by late March.

The 172 million barrels of SPR released represent one of the largest policy interventions by the U.S. government in recent years. Notably, this release is not a simple “sale,” but more akin to an “exchange”: companies receive crude oil now but are required to return it in the future, possibly with interest. This means the policy goal is not only short-term price suppression but also medium- to long-term inventory management.

From historical experience and market structure, the impact of releasing oil reserves on prices has clear “timing” and “structural” characteristics.

• Short-term: alleviating spot shortages and lowering near-term prices

Media reports indicate traders have begun selling nearby futures and buying longer-dated contracts, reflecting that the release will increase short-term supply, but there will still be pressure to replenish stocks later.

This suggests: spot prices may decline, and futures curves could become “backwardated” (futures prices higher than spot).

• Medium-term: price support persists, geopolitical risks dominate

Similar to the 2022 Russia-Ukraine conflict, oil reserve releases can only hedge part of the “supply gap” and are unlikely to reverse the overall trend.

The current situation is more complex: larger-scale supply disruptions in the Middle East; ongoing shipping risks around the Strait of Hormuz; and energy infrastructure becoming targets for attacks.

Therefore, even with a release of 172 million barrels, the market may still experience high volatility.

• Long-term: inventory pressures and policy space are limited

Strategic petroleum reserves are essentially a “safety cushion.” The U.S. SPR has a total capacity of about 700 million barrels, but recent large-scale withdrawals have brought inventories to historically low levels.

Wallstreet.cn mentioned this week that after releasing 172 million barrels, the U.S. SPR’s total inventory will drop to 244 million barrels, well below the statutory red line of 252 million barrels. Additionally, salt cavern storage structures require maintaining a minimum safety stock of 150–160 million barrels. Even if the red line is broken, there is less than 90 million barrels of additional release capacity.

In summary, continuous releases will weaken future crisis response capability, as the marginal effectiveness of policy tools diminishes, and subsequent replenishment at high prices will increase fiscal costs.