Reserves dropped by 6.1 million barrels last week, while talks with Iran over the Strait of Hormuz stall. The U.S. approaches its operational minimum, and Iran signals no negotiations with Trump.
The U.S. Strategic Petroleum Reserve (SPR) has fallen below 300 million barrels, marking the first time since January 1983 that reserves have hit this level. According to data released Monday by the U.S. Department of Energy, the reserve was reduced by 6.1 million barrels last week, bringing it down to 298.7 million barrels. This outflow represents a sharp increase from the previous week, when 2.8 million barrels were drawn from the reserve, and is the largest weekly decline in nearly two months.
The dramatic drop in reserves comes after President Donald Trump ordered the release of 172 million barrels of oil from the SPR in March 2026. That decision followed Iran's disruption of oil exports through the Strait of Hormuz. Before the start of U.S. and Israeli strikes on Iran on February 28, 2026, the SPR held approximately 415 million barrels. Reserves are expected to fall to around 243 million barrels once the ordered release is completed.
Meanwhile, negotiations between the U.S. and Iran over reopening the Strait of Hormuz are yielding no results. According to unofficial reports, Iran has "completely ruled out any future negotiations with the Trump administration" and plans to wait until the end of his term on January 20, 2029.
"Trump will not reach a deal with us. We will see out the rest of his term," said Majid Shakeri, an advisor to the speaker of Iran's parliament, Ghalibaf, according to Iranian media. In a social media post, Shakeri added: "The path to victory is neither fighting nor agreeing; it is managing the process of neither war nor peace, up to the point of victory. Publicly confirming negotiations with the U.S. is sheer folly. The winning approach is denial, ambiguity, and strategic patience."
The oil industry generally accepts that the operational minimum for the SPR-the point at which it becomes significantly harder to pump oil-is between 250 and 300 million barrels. Studies conducted in the 1970s recommended a minimum inventory of 250 million barrels. The U.S. is already at that threshold or will reach it within a few weeks if the weekly drawdown continues at this pace.
Additional pressure on the reserve comes from a December 2025 report by the Government Accountability Office (GAO). It states that more than a quarter of the SPR's inventory, totaling 103 million barrels, was unavailable for withdrawal. The U.S. Department of Energy estimates that about 70 million barrels is the minimum amount needed for safe operation of the reserve, but outdated infrastructure further limits the ability to quickly pump out part of the stock.
The release of U.S. reserves is part of a coordinated action by International Energy Agency (IEA) countries, which have placed 400 million barrels of oil on the global market to stabilize prices. However, the U.S. has by far been the most aggressive in using its strategic reserves. Although oil prices continue to fall for now due to hopes for a diplomatic solution to the conflict, analysts warn that the depletion of physical reserves could lead to a sharp spike in prices once the market realizes that "physical oil always beats paper oil."
