The U.S. might have a trade deficit overall, but when it comes to energy, trade is in surplus land for the first time - ever.
A new milestone has been reached in the global energy markets. For the first time on record, the value of U.S. energy exports exceeded the value of imports based on 2020 data. There was an energy trade surplus of $27 billion last year, as the value of coal, electricity, natural gas, and petroleum exports surpassed that of the value of the imports. And for the first six months of this year, the trade value of energy was a surplus of $9 billion, even as non-energy goods exports experienced a record $938-billion deficit.
The bulk of the U.S. energy trade is petroleum, but in 2020 the trade value of petroleum exports vs. imports was a deficit. So where does the surplus come from? Natural gas is the one to watch. It’s a growing percentage of the total, accounting for 5% of energy import value in 2020, and 22% of energy export value - for a surplus of $26 billion. Natural gas exports are continuing the march this year, in part by increased pipeline gas to Mexico and increased LNG exports.
The natural gas crunch in Europe could further increase the calls on U.S. gas exports, while Asia looks to import more U.S. LNG as well. Even before the gas crunch, U.S. exports of LNG to China, Japan, and South Korea - the world’s top LNG importers, reached new highs earlier this year as Asia began to recover from the pandemic and experienced a warm…
The U.S. might have a trade deficit overall, but when it comes to energy, trade is in surplus land for the first time - ever.
A new milestone has been reached in the global energy markets. For the first time on record, the value of U.S. energy exports exceeded the value of imports based on 2020 data. There was an energy trade surplus of $27 billion last year, as the value of coal, electricity, natural gas, and petroleum exports surpassed that of the value of the imports. And for the first six months of this year, the trade value of energy was a surplus of $9 billion, even as non-energy goods exports experienced a record $938-billion deficit.
The bulk of the U.S. energy trade is petroleum, but in 2020 the trade value of petroleum exports vs. imports was a deficit. So where does the surplus come from? Natural gas is the one to watch. It’s a growing percentage of the total, accounting for 5% of energy import value in 2020, and 22% of energy export value - for a surplus of $26 billion. Natural gas exports are continuing the march this year, in part by increased pipeline gas to Mexico and increased LNG exports.
The natural gas crunch in Europe could further increase the calls on U.S. gas exports, while Asia looks to import more U.S. LNG as well. Even before the gas crunch, U.S. exports of LNG to China, Japan, and South Korea - the world’s top LNG importers, reached new highs earlier this year as Asia began to recover from the pandemic and experienced a warm summer, and as other LNG producers - including Australia - saw supply outages.
The EIA is estimating that U.S. LNG exports this year will exceed pipeline exports for the first time since it started exporting LNG.
The U.S. energy trade isn’t sufficient enough to bring the overall U.S. into a trade surplus, but the fact that the value of the U.S. energy exports exceeded - by a long shot - U.S. energy imports, should give the Biden administration pause as it struggles to manage both the trade deficit and the energy transition.
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