Global Strategic Petroleum Reserves - GSPR
Categories: Derivatives, International, Econ
Global Strategic Petroleum Reserves (GSPR) are crude oil stockpiles maintained by countries and private firms for when (if?) an energy crisis occurs. While the government’s goal would be generally to maintain stability and national security, private crude oil stockpilers are making an investment (and a bet) which could earn them some big bucks if things go right...or, well, if things go wrong.
About a quarter of GSPRs are help by governments, and the rest by private organizations. The U.S. Strategic Petroleum Reserve...as you can guess by the name...is not only the largest keeper of crude oil, but has more than everyone else sitting on crude oil reserves combined in the private sector. It’s kind of their thing.
Why are people stockpiling crude oil? People are afraid of, and waiting for, “peak oil,” which is when it’s just not worth it anymore to extract liquid dino-bones from the earth. Eventually it’ll get too expensive, or we won’t be able to find anymore, or some combination of reasons. When that happens, there will be a big to-do, since so much of the global economy and the machines in it depend on oil. We’ll be hit a bit less-hard if we start transitioning to other energy sources, but that’s easier said than done.