US aims to loan about a third of heating oil reserve in bid to tame prices
USO•The Energy Department will loan up to 315,000 barrels from the Northeast Home Heating Oil Reserve, with deliveries set to be completed by November 13. The department will evaluate whether further releases are necessary.
1. Reserve loan details
The Trump administration is offering to loan up to nearly a third of the 1-million-barrel emergency heating oil reserve, with fuel coming from Maine, Massachusetts and Connecticut. The department said loans will be awarded through competitive bidding to fuel retailers and terminal holders, and deliveries are due by November 13.
2. Price impact debated
Heating oil is similar in composition to diesel, whose retail price recently hovered around $6.32 per gallon after reaching a record $6.52 last month. Senator Susan Collins said the release equals a 13% supply increase for New England and would push down winter heating oil costs, while Gulf Oil adviser Tom Kloza called it “puzzling and probably inconsequential” and said it should have no impact on prices.
3. Further releases possible
A department source said officials will evaluate whether additional releases are necessary. The reserve has been tapped once before, after Hurricane Sandy struck the region in 2012.
