Biden is sending China 1 million barrels of oil per day from America's Strategic Petroleum Reserves

NOTE: I’ve updated the post to discuss claims that Biden’s decision to sell SPR oil to China benefited Hunter Biden (FYI - it didn’t). Scroll to the bottom for my discussion on that topic.

President Biden’s decision to transfer oil from America’s Strategic Petroleum Reserves1 (SPR) to China has depleted our reserves to the lowest level since 1985.2 On the other hand, in less than a month for the first time in history, China will have more oil in its Strategic Petroleum Reserves than the United States. In just fourteen months, assuming Biden continues to empty the SPR at the current rate, our strategic petroleum reserves will be completely depleted.

The United States created the SPR in 1975. Almost 30 years later China created its own SPR in 2003. The total capacity of America’s SPR is 727 million barrels3 compared with China’s estimated SPR of 500 million barrels. It should be noted that China’s actual oil reserves are likely closer to 1,000 million barrels out of a total capacity of 1,000 million barrels taking into account strategic and commercial storage facilities.4

When oil prices collapsed in March 2020 to $32.01 per barrel President Trump proposed purchasing 77 million barrels of oil to completely fill the SPR for approximately $2.5 billion.5 Democratic Senator Charles Schumer successfully blocked the purchase calling it a ‘$3 billion bailout for big oil’.6 Today it would cost ten times as much ($23 billion) to fill the SPR to capacity.7

So why should you care?

The SPR was created to provide the US with crude oil in the event of a severe oil supply or economic disruption. According to the DOE the “Reserve should be used solely for responding to the types of severe oil supply interruptions presently contemplated in the Energy Policy and Conservation Act.” Transferring oil from our SPR to China’s SPR does NOT increase the amount of oil in the market - it simply gives China a possible strategic advantage in the event of a conflict between our two nations. If Biden really wanted to reduce the price of gasoline he’d release the oil to American refiners and have it delivered to the gas stations Biden has been attacking.8

UPDATE: Biden’s decision to sell oil to the Chinese did NOT benefit Hunter Biden.

Background: Once the president authorizes the sale of crude from the SPR the DOE makes the oil available to buyers through the "SPR's Crude Oil Sales Offer Program". The DOE then determines how much crude will be released from which SPR location (there are several) and notifies ALL prospective offerors who are on the registry. The prospective purchasers then submit unconditional offers and post a bond equal to the contract value. The DOE determines the winners based on who offers the highest price (relative to the cost of delivery). Once the winners are notified they must provide the DOE with a letter of credit for the total amount of their bid - only then does the DOE issue a Notice of Award. China (through companies controlled by the CCP) is just one of the hundreds of registered purchasers.

China paid market prices for the oil - there is no economic benefit to the deal. The benefit to China comes as a result of filling their own SPR - they are the world's largest importer of oil - and the US controls more than 80% of the world's oil production in one way or another. Hunter and the Big Guy don't get anything out of the deal. That being said I think emptying the SPR is a REALLY bad idea that puts our nation at risk and emboldens our enemies in China.

Additionally, it isn’t clear what involvement Hunter has with the Chinese Communist Party-backed fund anymore - he attempted to conceal his ownership by transferring it to an LLC he owned. When the New York Post discovered his subterfuge Hunter shut down the LLC and it is unclear what happened next - presumably, the FBI is on the case (cough, cough)…