Oil imports help feed US export powerhouse

17 Jul 2017   exports, USA

The US oil industry is rapidly turning the country into an energy export powerhouse, tipped last week by one prominent consultancy to start shipping more oil overseas than the majority of Opec countries by 2020. But this export flurry, brought on by the rejuvenation of the shale oil revolution and the lifting of decades-old export restrictions, has a flip side: as more oil flows out of the US more is also flowing in. In the first six months of 2017, as US crude exports have at times crested 1m barrels a day, imports of crude oil US have risen 5 per cent, or more than 300,000 b/d, compared with the same period last year. The data, from the US Energy Information Administration, illustrate that, while rising US exports are often portrayed as a straightforward threat to Opec, the emerging reality is more nuanced. The US remains the world’s biggest consumer of crude, burning almost 20m b/d, or more than one in every five barrels globally. As one of the world’s biggest importers of crude, even though domestic supplies are rising, domestic oil refiners will need to source alternatives from elsewhere if they are to pursue large-scale exports. “Ships will start passing in the night again,” said Stephen Wolfe, US analyst for Trafigura, the Swiss-based independent trading house that has been one of the largest shippers of US crude overseas. “With more barrels going out you need more coming in.” About two-thirds of the rise in US imports this year has come from Canada, where investments made in the oil sands region before prices fell from more than $100 a barrel in early 2014 to less than $50 a barrel today, have led to rising supplies of heavy bitumen-like crude.

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