The Bush administration will temporarily halt oil shipments into the U.S. Strategic Petroleum Reserve (SPR) for the rest of this year, the Energy Department announced Friday.
The government "will not sign contracts this year for the receipt and transportation of up to 13 million barrels of crude oil to the nation's Strategic Petroleum Reserve sites," said the department in a statement.
Once the six-month contracts signed, the government would accept 76,000 barrels of crude oil a day starting from July 1, 2008 with deliveries of oil beginning in August and continuing through December this year, according to the statement.
The announcement came days after Congress passed legislation requiring the government to suspend oil deliveries into the reserve in hopes of lowering gasoline prices.
U.S. President George W. Bush is expected to sign the bill, according to local news reports.
Bush had opposed halting the shipments, arguing that such a relatively small amount of oil would not influence prices.
It is not clear how much of an impact the suspension of deliveries into the reserve will have on oil or gasoline prices.
As crude oil prices hit new records, average gasoline costs in the United States keep soaring, adding more pressures on consumers and businesses who are struggling through the housing slump and a credit crisis.
The SPR, which was established in December 1975 following the Arab oil embargo, has a capacity of 727 million barrels.
In his State of the Union speech to Congress in January 2007, Bush said that he wants to eventually expand the oil stockpile, which is kept as a cushion in case of a major disruption of oil supplies, to 1.5 billion barrels over the next 20 years.
Since the start of the Bush administration, the SPR's inventory has increased in size from approximately 540 million barrels to its current inventory of 702.7 million barrels of oil stored in the underground salt caverns located along the Gulf Coast of Louisiana and Texas.
Source:Xinhua
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