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A major change in oil…
Between 2010 and 2016, American crude and petroleum product exports more than doubled from 2.4 million barrels per day to 5.2 million bpd, according to a new report from the Energy Information Administration (EIA).
Since a spending bill signed by President Barack Obama in December 2015 lifted the decades-long ban on American crude exports, oil tankers loaded in U.S. ports have reached Europe, Asia, and other North American countries. In February 2017, total exports reached 1.1 million bpd – the highest monthly level on record.
Motor gasoline exports have jumped by 126 percent since 2010, the report says, noting that Mexico has been the biggest customer for refined product. In the past five years, Mexico has bought anywhere between 44 percent and 53 percent of all American gasoline exports.
The U.S. had banned crude exports in the 1970s, after the Arab Oil Embargo—erected by Middle Eastern oil producers as retaliation for American political and military support of Israel—caused severe energy shortages.
Today, the EIA also reported a 2.5-million-barrel draw in domestic crude oil inventories.
Related: How A $200,000 Well Could Drastically Change The Oil Industry
WTI, which has since the start of the year lost 20 percent, now might get a short respite thanks to EIA’s figures. At the time of writing, it traded at $43.62 per barrel, with Brent crude at $46.01 a barrel. On Tuesday, WTI settled at the lowest level since last August, at $43.23 a barrel.
The active rig count in the U.S. increased last week for the 22nd week in a row, reinforcing expectations that U.S. crude oil output will continue to stave off OPEC cuts, plunging international prices deeper. In a note to investors, Barclays said that the keep the rig count above 900, U.S. producers would have to spend 70 percent more and the costs per well would have to decline – both very unlikely.
By Zainab Calcuttawala for Oilprice.com
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Zainab Calcuttawala is an American journalist based in Morocco. She completed her undergraduate coursework at the University of Texas at Austin (Hook’em) and reports on…