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How is the U.S. is becoming “Energy Independent,” if we are still
importing almost 8 million barrels per day of oil?? While the
Mainstream media and the Whitehouse continue with the energy independent
mantra, the U.S. is still highly reliant upon a great deal of
foreign oil. And, why would the U.S. import 8 million
barrels of oil per day if its shale oil production has surged over the past
decade?
Well, it’s quite simple. The U.S. Shale Oil Industry is producing
way too much light tight oil, with a high API Gravity, for our refineries
that are designed for a lower grade. So, as U.S. shale oil
production exploded, the industry was forced to export a great deal more of
this light oil overseas.
Here is a chart of the different grades of U.S. crude oil and condensate
production:
The figures in the table above are shown in thousand barrels per
day. The U.S. produced 483,000 barrels per day (bd) of heavy oil in
April, 3.9 million barrels per day (mbd) of medium oil and 5.5 mbd of light
oil and condensate. Condensate’s API gravity usually is 50° or
higher. The 3,688,000 bd of 40°-45° crude is mostly shale light tight
oil produced in the shale oil fields in North Dakota and Texas.
As I mentioned, the United States can’t be energy independent if it must
rely upon 8 mbd of foreign oil supplies. According to the charts from
the CrudeOilPeak.info,
the United States imported 7.8 mbd of oil over the past 12 months:
You will notice that most of our oil imports come from Canada (Dark
Brown). The reason for the growth in Canadian heavier oil
imports (oil sands) is that it is used to blend with our shale light tight
oil to make a more medium blend. Thus, we need the heavier Canadian oil
sands to blend with our lighter shale oil. However, we still produce
way too much light oil, so we are forced to export it overseas.
Matt, the author at CrudeOilPeak.inf, does a great job producing oil
charts, and here is another below:
This chart shows the increase in U.S. oil exports. As shale oil
production increased significantly in 2017, so did our oil exports.
From the article, US
crude oil imports and exports update April 2018 data:
The US had a crude oil export ban in place but Canada was exempted due to the
integrated oil supply system. The export ban was lifted in January
2016 because US refiners could not absorb increasing quantities of tight oil
(one reason why oil prices dropped).
In many countries extra light US shale oil is being used as a blending component,
but not as bulk feedstock. Important volumes of US crude oil exports (which
would matter on global oil markets) go only to a few countries.
No matter what clever US energy independence calculations are out
there, the fact remains that the US is physically dependent on around 8 mb/d
of crude oil imports, 4.3 mb/d out of which come from countries
where oil production has already peaked and/or where there are socio-
economic or geopolitical problems. As of April 2018 US net crude
imports were about 6 mb/d, far from oil independence.
Unfortunately, very light tight shale oil is not in big demand
overseas. Instead, our shale oil exports are used more as a blending
component rather than a bulk feedstock. So, the more shale oil we
produce, the more we will be forced to export.
The United States will never become energy independent even if domestic
shale oil production continues to surge higher. However, I believe
shale oil production in the states will likely start to decline within the
next 1-3 years. When the OVER-BLOATED and HIGHLY LEVERAGED stock
markets begin to collapse, they will also take down the oil price. A
falling oil price will destroy the already weakened shale oil industry.
The Death of the U.S. Shale Oil Ponzi Scheme is approaching. If you
have not seen my video on the Shale Oil Ponzi, I highly recommend you watch
the presentation below:
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