WASHINGTON - Sen. John Cornyn and a bipartisan group of Texas congressmen are preparing to introduce legislation that would fund a $3 billion purchase of oil for the nation's Strategic Petroleum Reserve.

At a time the U.S. benchmark West Texas Intermediate oil is selling for less than $25 a barrel, the bill, which is sponsored by Texas Republican Michael Burgess of Denton, and Democrats Lizzie Fletcher of Houston, and Henry Cuellar of Laredo, is intended to help U.S. oil producers while filling up the petroleum reserve on the cheap.

“Without swift action, the coronavirus could have a devastating impact on Texas’ energy producers and their workforce,” said Cornyn. “This legislation would help support small to midsize producers and Texas workers while enhancing national security during this uncertain time.”

President Donald Trump has ordered the purchase of close to 80 million barrels of crude to fill the petroleum reserve up to its capacity of almost 800 million barrels.

But Democratic leaders in Congress have resisted funding the purchase, with Senate Minority Leader Chuck Schumer, D-N.Y., calling it a "bailout for big oil."

Sen. John Hoeven, along with Representatives Lizzie Fletcher and Michael Burgess, announced Tuesday, April 7, that they are introducing bipartisan, bicameral legislation in the U.S. Senate and the U.S. House of Representatives respectively to provide $3 billion in funding to purchase crude oil produced in the United States for the Strategic Petroleum Reserve (SPR). The legislation aligns with the request made by President Donald J. Trump and Energy Secretary Dan Brouillette to fill the SPR.

The legislation is being cosponsored by Sens. John Cornyn, Kevin Cramer, Ted Cruz, Lisa Murkowski, Dan Sullivan, and Reps. Kelly Armstrong and Henry Cuellar.

“Oil and gas producers in North Dakota and across the U.S. are vital for both our economic and national security,” Hoeven said. “This legislation provides important support to our domestic energy industry at a time when they are not only challenged by the impacts of the coronavirus but also a global oil price war. Purchasing U.S. oil for the SPR will not only benefit our energy producers, but also taxpayers and our national security. This legislation, along with our efforts to stop the global price war, are part of our work to support our domestic energy producers and provide stability to global energy markets.”

“Funding Strategic Petroleum Reserve purchases is a small, simple way to purchase oil from local producers as we work to combat COVID—19 and put an end to the harmful oil dispute between Saudi Arabia and Russia,” said Senator Cramer. “Unfortunately, these funds were held hostage during Phase Three negotiations. While I support Secretary Brouillette finding administrative ways to make SPR purchases, Congress should play its part and include this funding in Phase Four.”

“Foreign manipulation of oil prices and the economic effects of COVID-19 are threatening America’s energy independence. The U.S. energy industry strengthens our national security and is a major economic driver, employing millions of workers directly and indirectly. The purchase of oil for the nation’s strategic reserves will help domestic producers withstand these forces outside their control and protect our energy security,” said Congressman Armstrong.

WASHINGTON (Reuters) - A bipartisan group of U.S. lawmakers introduced a bill on Tuesday providing $3 billion to buy oil for the national emergency reserve as a way to help energy companies hit by the plunge in crude prices.

The bill, which would have to be passed in the Senate and the House of Representatives and signed by President Donald Trump, was introduced by Senator John Hoeven and Representative Michael Burgess, both Republicans, and Representative Lizzie Fletcher, a Democrat. Representative Henry Cuellar, also a Democrat, is a cosponsor.

The U.S. Department of Energy, or DOE, last month ditched an original tender to buy 30 million barrels of oil for the Strategic Petroleum Reserve after Congress failed to include funding in a stimulus bill meant to help the economy deal with the impact of the coronavirus outbreak.

That move was a blow to Trump, who on March 13 had directed the DOE to fill the reserve, which can take another 77 million barrels of oil, "to the top." Even if a purchase is authorized, analysts said it would not do much to push up the global oil price and help crude producers due to the severe demand destruction as the coronavirus cripples economies.

The DOE now plans to lease space in the SPR, a series of salt caverns on the Texas and Louisiana coasts, but the department said on Tuesday it continues to work with Congress on funding for the purchase of oil for the reserve.

Published here. 

HOUSTON, Texas - U.S. Sens. Ted Cruz (R-Texas) and John Hoeven (R-N.D.), along with Reps. Lizzie Fletcher (D-Texas) and Michael Burgess (R-Texas), and House and Senate colleagues today announced they are introducing bipartisan, bicameral legislation to provide $3 billion in funding to purchase crude oil produced in the United States for the Strategic Petroleum Reserve (SPR). The legislation aligns with the request made by President Trump and Energy Secretary Dan Brouillette to fill the SPR. Sens. John Cornyn (R-Texas), Kevin Cramer (R-N.D.), Lisa Murkowski (R-Alaska), Dan Sullivan (R-Alaska), and Reps. Kelly Armstrong (R-N.D.) and Henry Cuellar (D-Texas) are original cosponsors.

'For years the federal government has taken the backwards approach of buying oil when it's expensive and selling it off from the strategic petroleum reserve when it's cheap,' Sen. Cruz said. 'Now, with low oil prices, we actually have an opportunity to do the opposite, get more for our dollar, and replenish our strategic petroleum reserve. That's a win for America's taxpayers and workers, as well as for our nation's energy security. This commonsense proposal should have already been signed into law with the emergency relief bill we delivered last month, but it was blocked by Democratic leadership in the House and Senate at the last minute. I look forward to righting the ship and introducing the bill with Sen. Hoeven and my colleagues as soon as the Senate returns.'

'Oil and gas producers in North Dakota and across the U.S. are vital for both our economic and national security,' Sen. Hoeven said. 'This legislation provides important support to our domestic energy industry at a time when they are not only challenged by the impacts of the coronavirus but also a global oil price war. Purchasing U.S. oil for the SPR will not only benefit our energy producers, but also taxpayers and our national security. This legislation, along with our efforts to stop the global price war, are part of our work to support our domestic energy producers and provide stability to global energy markets.'

'Domestic production of oil and natural gas is essential to our national security, our economy, and our energy future, including our ability to drive innovation and production of cleaner energy,' Rep. Fletcher said. 'Our energy producers are facing an unprecedented challenge that will have long-term ramifications for our energy independence and our energy future. I am glad to join Senator Hoeven and Congressman Burgess to announce bipartisan legislation that provides relief for the many Americans who work to provide the energy we need today.'

'The Strategic Petroleum Reserve is a critical asset to ensure America's energy security, and President Trump is right to request the SPR be filled while prices are low,' Rep. Burgess said.'This legislation provides support to American energy producers during this public health crisis, ensuring that made-in-America energy remains a strength for our country. Over the last decade America has emerged as a global leader in energy production. It is critical that this leadership is preserved and measures are put in place to ensure America's influence on energy markets. Through timely and prudent purchases by the Department of Energy, the United States will be able to improve its energy resilience, temporarily stabilize energy markets, and save taxpayers money over the long run.'

'Without swift action, the coronavirus could have a devastating impact on Texas' energy producers and their workforce,' Sen. Cornyn said. 'This legislation would help support small to midsize producers and Texas workers while enhancing national security during this uncertain time.'

'Funding Strategic Petroleum Reserve purchases is a small, simple way to purchase oil from local producers as we work to combat COVID-19 and put an end to the harmful oil dispute between Saudi Arabia and Russia,' Sen. Cramer said. 'Unfortunately, these funds were held hostage during Phase Three negotiations. While I support Secretary Brouillette finding administrative ways to make SPR purchases, Congress should play its part and include this funding in Phase Four.'

'The oil and gas industry is critical to our nation's economy and supports more than 10 million jobs. With plummeting global demand wrought by the coronavirus pandemic and supply rising as a result of the Saudi-Russian price war, prices have fallen to their lowest levels in nearly 20 years,' Sen. Murkowski said. 'We can provide some assistance to the industry by refilling the Strategic Petroleum Reserve to capacity, and we should take advantage of this opportunity to buy low and buy American.'

'With the unprecedented challenges we are facing as a country, from the oil price war between Saudi Arabia and Russia to the demand-drop in oil due to our efforts to combat COVID-19, we must act swiftly to support America's workers to ensure we can get the economy roaring again when we overcome this pandemic,' Sen. Sullivan said. 'Funding purchases of oil produced in America for the SPR is one way we can fight back and support the hard-working men and women of our energy sector as we weather this storm.'

'Foreign manipulation of oil prices and the economic effects of COVID-19 are threatening America's energy independence,' Rep. Armstrong said. 'The U.S. energy industry strengthens our national security and is a major economic driver, employing millions of workers directly and indirectly. The purchase of oil for the nation's strategic reserves will help domestic producers withstand these forces outside their control and protect our energy security.'

'The COVID-19 pandemic has created an unprecedented economic crisis, greatly impacting the energy sector in Texas and across the nation,' Rep. Cuellar said. 'During these challenging times, we must invest in both renewable energy as well as preserve the record economic gains in the oil and gas industry the United States has obtained in recent years. For this reason, I am co-sponsoring this legislation so we can fund and replenish the Strategic Petroleum Reserve in order to protect the global market from a supply disruption. We must defend the energy sector and take care of the millions of American working families who rely on it. Replenishing the SPR will not only strengthen our economic well-being, but also our national security.'

WASHINGTON — A bipartisan group of lawmakers from Texas called Tuesday for a $3 billion federal purchase of oil to replenish the nation’s strategic reserve and prop up an energy sector rattled by a price war and global drop in demand during the coronavirus outbreak.

“Without swift action, the coronavirus could have a devastating impact on Texas’ energy producers and their workforce,” Sen. John Cornyn said. “This legislation would help support small to midsize producers and Texas workers while enhancing national security during this uncertain time.”

Cornyn and fellow Texas Sen. Ted Cruz support the proposal authored by Sen. John Hoeven, R-N.D.

In the House, Reps. Michael Burgess, R-Pilot Point, is among the initial supporters, along with Democratic Reps. Lizzie Fletcher of Houston and Henry Cuellar of Laredo and four lawmakers from other states that depend on oil and gas production.

With Congress on an extended recess during the outbreak, the bill will be formally introduced later in April, Hoeven said.

The proposal comes several weeks after Energy Secretary Dan Brouillette asked Congress for funding to fill the nation’s Strategic Petroleum Reserve with 77 million barrels to help domestic crude producers.

The idea of replenishing the SPR has hit some resistance in Congress.

Some Democrats refused to include such funding in the $2 trillion economic relief package that became law on March 27, citing the industry's role in climate change. Senate Minority Leader Chuck Schumer, D-N.Y., called such funding a "bailout for big oil.”

Backers call it a way to take advantage of low prices while also blunting the impact of the crisis.

“Domestic production of oil and natural gas is essential to our national security, our economy, and our energy future, including our ability to drive innovation and production of cleaner energy,” Fletcher said in a statement. “Our energy producers are facing an unprecedented challenge that will have long-term ramifications for our energy independence and our energy future.”

Worldwide, the petroleum business has struggled during the pandemic that has drastically cut demand, exacerbated by a price war that Saudi Arabia launched against Russia. U.S. crude oil prices have plummeted as the two sides pump more oil into international markets.

Energy states like Texas have borne the brunt of the price war, with state comptroller Glenn Hegar last week saying there’s “no doubt” the state will be in a recession.

In an effort to address the crisis, executives from Irving-based Exxon Mobil and other top energy companies met last Friday with President Donald Trump. Texas Sens. John Cornyn and Ted Cruz, both co-sponsors of the bill, attended the meeting.

The U.S. strategic reserve can hold 713.5 million barrels of petroleum in 60 huge underground salt caverns at four sites in Texas and Louisiana. The reserve is used to deter foreign suppliers from using U.S. reliance on imports as a weapon, and to offset supply disruptions from unrest, weather events and other causes.

The government has only tapped the reserve three times, most recently in 2011.

The proposal announced Tuesday would allow the government to fill the reserve on the cheap while addressing some of the surplus in the international market.

Cuellar said such a purchase “will not only strengthen our economic well-being, but also our national security,” while Cruz called it “a win for America’s taxpayers and workers, as well as for our nation’s energy security.”

“For years the federal government has taken the backwards approach of buying oil when it’s expensive and selling it off from the strategic petroleum reserve when it’s cheap,” Cruz said in a statement. “Now, with low oil prices, we actually have an opportunity to do the opposite, get more for our dollar, and replenish our strategic petroleum reserve.”

Congressman Michael C. Burgess, M.D. appeared on Spicer & Co. to discuss the latest on Coronavirus. 

More here.