The United States is currently the world's largest crude oil producer, but it still needs to import heavy varieties of oil, as most of the domestic output tends to be light crude while refineries are running on a diverse range of crudes, including heavy oil, the Energy Information Administration (EIA) said in an analysis on Friday.
Crude oil production in the U.S. jumped by 17 percent in 2018, setting a new production record of almost 11.0 million bpd, with the Permian contributing to most of the production growth, the EIA said earlier this week. Last year, the United States beat Saudi Arabia to become the single largest petroleum producer, the EIA said, noting that "Last year's increase in the United States was one of the largest absolute petroleum and natural gas production increases from a single country in history."
Despite these record-setting figures, America continues to import heavy oil because the Permian, the Eagle Ford, and the Bakken produce mostly relatively light crude oil, while refineries need heavy oil, too.
"Overall U.S. refining capacity is geared toward a diverse range of crude oil inputs, so it can be uneconomic to run some refineries solely on light or heavy crude oil," the EIA added.
The fastest-growing U.S. production is from shale formations and with API gravity of 40 to 50 degrees, the EIA has estimated, adding that oil with 40-50 degrees gravity accounted for 56 percent of the production in Texas last year, thanks to the Permian and the Eagle Ford.
While light oil production is booming, refineries still need heavier crudes, and most of the U.S. oil imports consist of heavy oil. Last year, 7.5 million bpd, or 97 percent, of all imported crude oil had an API gravity of 40 or lower, the EIA says.
Still, over the past ten years, the U.S. has reduced its overall crude oil imports while it has significantly boosted its total crude oil production. Since 2008, imports have declined by 21 percent, while domestic production has soared by 120 percent, the EIA noted.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More