U.S. DOE defers Feb crude oil delivery to reserve

By Chris Baltimore 06 Jan 2003 17:39

WASHINGTON, Jan 6 (Reuters) - The U.S. Energy Department on Monday said it has allowed oil companies to defer delivery of 3.1 million barrels of crude oil to the Strategic Petroleum Reserve until the end of September, citing concerns about an ongoing strike in Venezuela.

On Friday, Energy Secretary Spencer Abraham agreed "to allow companies that owe oil to the SPR due in February to enter into negotiations with the DOE to defer those deliveries until a later date," a department spokesman told Reuters. The deliveries would be due by Sept. 30, which is the end of fiscal 2003, the spokesman said.

Companies that received the deferrals asked not to be identified, the spokesman said.

In a similar move, the DOE last year agreed to allow oil companies to defer deliveries to the SPR due in December and January until the end of September. Oil companies will pay in-kind interest on the deferred deliveries.

The DOE action will "help ensure that the deliveries will not negatively affect the oil market while still providing for the energy security of the United States," the spokesman said.

The DOE said it is is closely monitoring a crippling strike in Venezuela, which extended onto its sixth week, sidelining the fourth-biggest U.S. oil supplier.

The strike in Venezuela, which held exports at one fifth of normal levels last week, has drained U.S. stockpiles to near their lowest levels in 26 years.

But the agency so far has not allowed any releases from the SPR to counter the Venezuela strike. Such an action would only come because of a "imminent and severe supply disruption," he said.

The reserve currently holds 599 million barrels of oil, the highest level in its history, DOE said.