Don't Bank On SPR - Forbes.com

WASHINGTON, D.C. -
Don't look to the Strategic Petroleum Reserve to ease surging oil prices after the shutdown of BP's pipeline in Prudhoe Bay: If history is any guide, any release from the SPR will be too little, too late. Or it might not come at all.
The 700-million-barrel stockpile sitting in salt caves along the Gulf Coast has been used only three times since it was created in the wake of the 1973 Arab oil embargo. And it is unclear whether it has ever successfully mitigated an oil price shock.
Not surprisingly, markets greeted with a yawn assurances by energy czar Samuel Bodman on Monday that he would come to the rescue in the event of an oil shortage. After closing at a near record in nominal terms of $76.98 the day before, prices edged off just slightly but remained above $76, as officials suggested that Prudhoe Bay's reserves might be offline until February.
There is no reason the SPR couldn't have a major impact during a price shock. Its drawdown capacity of 4 million barrels of oil per day is roughly equal to the amount Iran adds daily to the world oil supply. With the stockpile releasing at full tilt, the government would be able to replace over a third of oil imports and add about 5.9% to the world's daily oil supply for roughly 163 days before the reserve ran dry, according to a study last year by economists Jerry Taylor and Peter Van Doren of the libertarian Cato Institute.
The problem is the government's shoddy management of the reserves. It has tended to buy oil as prices are rising and then hoard it in a time of crisis.
"It's a policy of buying high and selling never," says Taylor.
Don't Bank On SPR - Forbes.com