How Persian Gulf Crisis and Strait of Hormuz Have Pushed US Strategic Oil Reserves to a Warning Level

At the end of September, US strategic oil reserves stood at around 283 million barrels, the lowest level since 1982. The reserves entered the war with Iran after replacing only about one-quarter of the oil drawn down in 2022.

According to Ambassador Arjan, the crisis in the Persian Gulf and disruption of oil transportation through the Strait of Hormuz has put the strategic oil reserves of the United States in a critical position. As conflicts have squeezed global oil supplies, US emergency reserves have also fallen to their lowest level since 1982.

According to the Oil Price report, the stock of these reserves at the end of September 2026 was about 283 million barrels. This situation has raised concerns about Washington's ability to deal with the continuation of the Persian Gulf crisis and manage possible future shocks in the energy market.

The importance of this issue comes from the fact that the Strait of Hormuz is one of the most vital oil transportation routes in the world. Any disruption to the passage of oil tankers through this passage could reduce global supply, increase prices and force consuming countries to use their emergency reserves. However, the rapid withdrawal of reserves does not mean that they can be rapidly restored. The United States is now facing a challenge in which the return of oil to the reservoirs depends on the state of the world market, the operational capacity of the facilities and the availability of financial resources.

US reserves were also weakened before the new crisis

The US strategic oil reserves were established in 1975 after the oil crisis of the 1970s so that the country could provide part of its needs from emergency sources in the event of a war, embargo or import disruption. The stock of these reserves reached about 726.6 million barrels at the end of 2009, but in 2022, after the start of the war between Russia and Ukraine, the US government released 180 million barrels of oil.

Although some oil was subsequently bought and some of the planned sales were canceled, inventories never returned to their previous levels. Their inventory at the end of 2025 was about 413.5 million barrels. Therefore, on the eve of the escalation of the Persian Gulf crisis, America entered the field with much less reserves than its capacity.

Following the American and Israeli attacks on Iran in March 1404 and the widespread disruption of oil tanker traffic through the Strait of Hormuz, Washington agreed in March to release 172 million barrels of oil in the framework of a program coordinated with the International Energy Agency. This action was part of the plan to release 400 million barrels of oil from the reserves of the participating countries, which was done with the aim of reducing the pressure on the world market.

It should be said that the American strategic oil reserves (SPR) help to curb the global shortage and price jumps by providing emergency oil during war, embargo or supply disruption, and the importance of these reserves is not only for America. Decreasing these reserves limits the US ability to calm the market and increases the risk of oil price volatility for all countries.

Oil exchange contracts and the challenge of restoring reserves

The US Department of Energy has used barter contracts instead of selling oil directly to prevent further depletion of reserves. Under this mechanism, companies receive oil now and must return the same amount plus an additional percentage in the future. The markup rate of some contracts has reached 28% and it is estimated that in case of full implementation of the program, about 40 million barrels of additional oil will be returned to the reserves.

However, the implementation of this program is dependent on market conditions. If the difference in oil prices for immediate and future delivery narrows, companies will have less incentive to participate. In June, out of 40 million barrels of oil offered for exchange, only 500,000 barrels were handed over to Vitol. The Energy Department re-supplied the volume on September 29, and deliveries are scheduled for November and December, according to OilPrice.

Another problem is the long repayment time. About 133 million barrels of oil have been withdrawn through swap contracts, and their return depends on companies' access to sufficient oil in the future. Some repayment dates also continue until the end of 2028. Therefore, even if the Persian Gulf crisis subsides, rebuilding US stockpiles will still take time.

Risk of reducing reserves below safe operating levels

A major concern is the depletion of reserves to levels that make it difficult to continue safe operations. The U.S. Department of Energy considers the physical minimum required for continued operation to be around 70 million barrels, but some experts believe that the safe operating level is much higher.

As Oilprice claimed, estimates by some petroleum engineering experts show that reserves of less than 250 to 300 million barrels could raise concerns about the structural health of salt caves and the ability to extract oil. Congress has also set a legal minimum of 252.4 million barrels for some limited emergency withdrawals.

The Ministry of Energy has predicted that after the full delivery of the scheduled oil, the reserves may reach about 243 million barrels. This level increases concerns about the reduction of the American confidence margin against new disruptions in oil supply.

On the other hand, reserves cannot be replenished quickly. The nominal capacity of withdrawing from the reserves is about 4.415 million barrels per day, while the nominal capacity of filling it is estimated to be only 785 thousand barrels per day. Technical problems and wear and tear of the infrastructure have also caused the actual performance to be lower than these capacities.

The cost of 20 billion dollars to restore reserves

Even if all the ceded oil is returned in the form of swap contracts and the expected premium is received, the US reserves will reach about 455 million barrels. This amount is still far from the effective capacity of about 680 million barrels of reserves.

The Ministry of Energy has estimated the cost of buying about 250 million more barrels of oil to return to near the maximum effective capacity of about 20 billion dollars. This calculation is based on the approximate price of 80 dollars per barrel. In contrast, the appropriation allocated by Congress for the purchase of oil is only 171 million dollars.

This financial gap shows that it is not possible to restore the reserves by relying only on exchange contracts. Finally, the government should provide financial resources to buy more oil. The proposal to use Venezuelan heavy oil also faces limitations, because the specifications of this oil are not fully compatible with the technical requirements of the US strategic reserves.

The perspective of the Persian Gulf crisis and the global oil market

Oil exports from the Persian Gulf region have returned to about 81 percent of pre-war levels, but attacks on oil tankers continue and Brent oil prices have once again exceeded $100 a barrel.

This statistic does not mean the full return of oil tanker traffic through the Strait of Hormuz to normal conditions, because part of the oil is transported through pipelines and alternative routes.

Despite the relative improvement in exports, attacks and security threats continue to maintain the risk of supply disruption. In such a situation, US strategic reserves are still considered an important tool to deal with new market shocks.

On the other hand, the restoration of reserves will lead to new demand in the oil market. Injecting hundreds of thousands of barrels of oil into reservoirs a day could put upward pressure on prices, especially if the Persian Gulf crisis continues to limit global supply.

The Persian Gulf crisis has shown that the US strategic oil reserves, despite their importance in crisis management, do not have an unlimited capacity to compensate for supply disruptions. The low balance of reserves, the slowness of the reconstruction process, the wear and tear of the infrastructure and the lack of funds have limited Washington's ability to deal with possible future crises.

Even if the region's oil exports return to pre-war levels, rebuilding US reserves will require significant time and financial resources. Therefore, the future of US energy security depends not only on the status of the Strait of Hormuz and the continuation or end of conflicts, but also on the government's ability to return oil to reserves and maintain operational readiness.