(Bloomberg) -- The Biden administration’s efforts to lower energy costs takes a step forward Monday, with bids due for the first 32 million barrels of crude planned for release from federal stockpiles.

Bids for the exchange offer, which is the first part of government’s 50 million-barrel release from the Strategic Petroleum Reserve, were due at 10 a.m C.T., the Department of Energy said when it first announced the release last month. Although winning bids won’t be announced until Dec. 14, at least two international oil refiners have expressed interested in the swap, according to people familiar with the matter.

The release is part of the Biden Administration’s effort to lower energy costs and tackle surging gasoline prices, which touched a seven-year high last month. Crude futures have dropped about 20% since late October, when the U.S. indicated it was considering a variety of tools to bring down fuel prices. The reserve is typically tapped when natural disasters disrupt the flow of oil.

U.S. refiners and international oil companies are expected to make up the majority of the participants. Most of the oil being released is high in sulfur and costs more to refine because it requires hydrogen produced from natural gas to run units to strip it of sulfur.

U.S. oil processors particularly in Texas, America’s refining hub, are subject to year-end taxes on their oil stocks and may limit appetite there to add barrels to storage. “Taxes on U.S. inventories may discourage refiners from adding inventories in December,” said Chris Barber, principal analyst at consultant ESAI. 

“China and India do process sour crude and that is what many of their refineries are configured to do. It’s just more expensive to do with high prices natural gas,” Barber said. “I think high gas prices will make SPR barrels less attractive for China and India unless heavily discounted.” 

Companies that borrow crude from the government will have to return the oil in 2022-2024 under specifications set by the Energy Department. This will requirement will be more easily met by producers of similar crude.

The Nymex futures market isn’t nearly as backwardated -- a bullish structure where oil for delivery now costs more than contracts dated for a later period -- as it was in October. That means a company taking SPR crude this month will end up paying more for barrels it will have to return than it would have before. 

Later this month, the government is set to announce a tender for another 18 million barrels as part of an accelerated release from previously authorized sales.

(Updates with more information in the sixth and seventh paragraphs.)

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