• 5 minutes 'No - Deal Brexit' vs 'Operation Fear' Globalist Pushback ... Impact to World Economies and Oil
  • 8 minutes China has *Already* Lost the Trade War. Meantime, the U.S. Might Sanction China’s Largest Oil Company
  • 12 minutes Will Uncle Sam Step Up and Cut Production
  • 15 hours OPEC will consider all options. What options do they have ?
  • 9 hours Danish Royal Palace ‘Surprised’ By Trump Canceling Trip
  • 12 hours Trump vs. Xi Trade Battle, Running Commentary from Conservative Tree House
  • 4 hours Not The Onion: Vivienne Westwood Says Greta Thunberg Should Run the World
  • 11 hours NATGAS, LNG, Technology, benefits etc , cleaner global energy fuel
  • 4 hours What to tell my students
  • 9 hours A legitimate Request: France Wants Progress In Ukraine Before Russia Returns To G7
  • 23 hours Recession Jitters Are Rising. Is There Reason To Worry?
  • 18 hours With Global Warming Greenland is Prime Real Estate
  • 16 hours China Threatens to Withhold Rare Earth Metals
  • 1 day TRUMP'S FORMER 'CHRISTIAN LIAISON' SAYS DEEPWATER HORIZON DISASTER WAS GOD'S PUNISHMENT FOR OBAMA ISRAEL DIVISION
  • 1 day Maybe 8 to 10 "good" years left in oil industry * UAE model for Economic Deversification * Others spent oil billions on funding terrorism, wars, suppressing dissidents, building nukes * Too late now
  • 1 day CLIMATE PANIC! ELEVENTY!!! "250,000 people die a year due to the climate crisis"
Daniel J. Graeber

Daniel J. Graeber

Daniel Graeber is a writer and political analyst based in Michigan. His work on matters related to the geopolitical aspects of the global energy sector,…

More Info

Premium Content

As U.S. Oil Imports Decline, Questions About Oil Exports Are Raised

U.S. crude oil imports are down 23 percent since production from tight oil plays started to increase in 2008. While some industry officials and observers wonder if the U.S. should position itself as an energy superpower, the debate may be influenced in large part by domestic refiners.

"The issue of crude oil exports is under consideration," U.S. Energy Secretary Ernest Moniz said from a two-day energy summit in South Korea.

U.S. oil exports are restricted by legislation enacted in response to an oil embargo from Arab members of the Organization of Petroleum Exporting Countries (OPEC) in the 1970s.

OPEC, in its May market report, said total U.S. crude oil imports dropped from an average 10.08 million barrels per day in January 2008 to 7.76 million bpd in December, 2013. That decline is in part a response to the increase in crude oil production from shale reserve areas in the United States. Of the six most prolific shale basins in the United States, only the Haynesville play is expected to hold its production level steady; the other five should see an increase.

The U.S. Energy Information Administration (EIA) said the Eagle Ford basin in southern Texas and the Permian basin, which straddles the Texas border with New Mexico, should post a combined 48,000 bpd production increase in June. Next month, the Bakken play, which sits on the border between North Dakota and Montana, should see production increase by 22,000 bpd to reach 1.07 million bpd, EIA said.

Six shale basins -- Permian, Eagle Ford, Bakken, Niobrara, Haynesville and Marcellus -- accounted for almost 90 percent of oil production growth since 2011. OPEC, in its market report, said North American oil production has increased five years in a row and U.S. oil production is now at its highest rate since 1972.

With oil output accelerating, strong cases have been made for and against reversing the ban.

In April, Erik Milito, director of upstream operations for the American Petroleum Institute, said oil exports would make the United States a "global energy superpower." But Leo Gerard, president of the United Steelworks lobby, said the previous month that lifting the ban would harm domestic refiners who may be forced to pay higher prices for domestic oil.

Right now, U.S. refiners who utilize regional crude enjoy a lower price than for oil sourced from overseas markets. Since January, when TransCanada's Marketlink pipeline came online, the gap between the price for West Texas Intermediate, the U.S. benchmark, and Brent, the overseas benchmark, has narrowed, however, and that discount in price is now lower.

U.S. oil production is on pace to increase, though the forecast for WTI is uncertain. As of May 13, it was holding steady about $100 per barrel. Moniz, the U.S. energy secretary, said several agencies are studying what role U.S. oil should play on the international stage. For now, however, it may be more of a downstream concern.

"A driver for this consideration is that the nature of the oil we're producing may not be well matched to our current refinery capacity," he said.

So while global influence is always a concern for Washington, issues closer to home may be the deciding factor for policymaking in the shale era.

By Daniel J. Graeber of Oilprice.com




Download The Free Oilprice App Today

Back to homepage


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play