While at conferences this week, I had the chance to speak with oil executives about America’s place in the world oil scene. As we spoke, I realized that there is some confusion regarding exactly what that means. It appears that what it surely does not mean is that the US will be the great world oil exporter in the near future. Lets take a look at the numbers as given by EIA, Weekly Petroleum Status Report, for week ending 3/22/2019.
The confusion starts with the definitions of oil and petroleum products (which is crude oil plus other hydrocarbons, or plus everything else). Take a look at these numbers, according to EIA (note that all numbers are given in per day basis):
Petroleum Consumption – about 20 million barrels
Oil Production – 12.1 million barrels
Net Oil Imports – 3.7 million barrels
Other Petroleum Products (natural gas liquids, ethanol, etc.) – 6.7 million barrels
Net Petroleum Products Exports – 3 million barrels
As you can see, the red numbers do not add up to 20 million barrels; however, when you account for products taken out of inventories, and other adjustments, the red numbers, petroleum supply, does add up to 20 million barrels – supply basically equals demand.
One thing does become evident, America is #1 in oil production and petroleum products, 12.1 and 20 million barrels respectively. As regards petroleum products, the term is a little fuzzy because that number includes net imports. What is not evident is that America will be a net oil exporter anytime soon. Currently our net import of crude is 3.7 million barrels.
One other thing is striking. Our petroleum stocks are at the highest levels in history. Why is the US importing oil when stocks are at their highest? Instead of importing oil, we should take some out of our record high storage levels.