Julianne Geiger reports on record-low U.S. Strategic Petroleum Reserve levels as geopolitical tensions drive crude oil prices higher.

The U.S. Strategic Petroleum Reserve (SPR) has dropped to a level not seen since 1983, reaching approximately 311.4 million barrels. This significant decline follows a period of heavy usage to offset supply disruptions caused by the Iran conflict and the closure of the Strait of Hormuz. The administration announced that the reserve has been utilized to maintain steady exports and cap domestic gasoline prices. While the SPR has successfully buffered against price spikes, analysts warn that the safety net is thinning. June Goh, an analyst at Sparta Commodities, suggested a "violent repricing" could occur if the buffer disappears completely. Market reactions have been positive for energy investors. Exxon Mobil and Chevron have seen significant year-to-date gains as the market anticipates potential supply tightness. While the SPR is currently 420 million barrels shy of maximum capacity, it remains a critical tool for managing global oil flows. Experts note that as the reserve reaches these multidecade lows, the administration has fewer tools available to mitigate future price shocks.

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