U.S. sells 4 percent of its emergency oil reserves

The United States sold more than 30 million barrels of crude from the Strategic Petroleum Reserve in its largest-ever auction of emergency supplies on Friday, naming independent refiner Valero the top buyer

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The Department of Energy listed winning bidders for 4.2 percent of the 727 million barrels it keeps in salt caverns in Texas and Louisiana to respond to supply disruptions. The oil should be released in July or August, it said.

In an indication of high demand for light, sweet crude, favored for gasoline and diesel production, the DOE said all of the oil on offer had been sold.

It seems to have been oversubscribed, which is a good sign,” said Edward Meir, senior analyst at MF Global in New York.

The releases are meant to respond to a cut in exports from war-torn Libya since late February. The  International Energy Agency, a 28-nation group representing most of the world’s top oil consumers, announced on June 23 plans to release 60 million barrels of crude and oil products globally, with U.S. supplies making up around half of the total.

The IEA has said it could release more oil later if markets remain tight. Other regions including Europe also began to tender additional supplies this week Overall, 15 companies committed to pay $3.3 billion for
30.6 million barrels on offer from the SPR, preliminary results showed. Final results are due by July 11, but are unlikely to differ much from those released on Friday, a DOE source said.

The average successful bid was $107.19 per barrel, about $3 below European benchmark Brent oil LCOc1 prices on Friday The top buyer is leading U.S. independent refiner Valero (VLO.N), which won 6.9 million barrels. Other buyers included integrated oil major Shell (RDSa.L), Swiss-Dutch oil trading

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