As if oil company stockpiles were not high enough, the Department of Energy released today a report showing that the nation's Strategic Petroleum Reserve in the Gulf States contained a record amount of crude oil- some 725 million barrels, or 30 billion gallons of oil.

With U.S. demand at nearly 18.5 million barrels per day, this strategic stockpile would last the country 39 days with no other oil production or imports. That's a huge amount of oil. Add the amount of oil in other storage, the U.S. has over 1.2 billion barrels of oil in storage (ready to refine) and 23 days of gasoline supply (ready to ship to stations). Generally, gasoline stockpiles are considered adequate at 21-22 days. Another day of gasoline demand represents 386.4 million gallons of gasoline.

As you can see, oil and gasoline stockpiles are well beyond "healthy". If refiners shut, we'd also have 48 days of diesel and heating oil on hand ready to ship as well. These numbers are all well-above their year ago numbers. This data is part of the reason oil prices have not been able to accelerate as easily as they have in the past. Overall demand is down across the United States as well- gasoline demand is slightly off last year, while diesel fuel demand is as weak as it was in the late 90's.

What we really need to see now is a stronger U.S. dollar, but that might hurt the economic recovery by making U.S. goods more expensive overseas. However, a stronger dollar would go a long way to making oil and gasoline cheaper!