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Energy Tomorrow Blog

We Can't Take Our Energy Security for Granted

us energy security  saudi arabia  domestic oil production  consumers 

Dean Foreman

Dean Foreman
Posted March 17, 2021

One of the great benefits of increased U.S. oil production over the past decade and a half is strengthened U.S. energy security – decreased reliance on foreign oil suppliers and insulation for American consumers against sudden price increases due to geopolitical events, such as the recent attacks on Persian Gulf oil facilities.

Years ago, an episode like that could’ve caused serious alarm in the United States and globally. Yet, the apparent lack of significant or enduring oil price movement following last weekend’s attack shows the tremendous influence U.S. oil production has had on global markets. The same was true after missile attacks on Saudi facilities in 2019 (see here), which substantially reduced Saudi Arabia’s oil exports for a short period. Both events and their aftermath indicate that U.S. domestic production has largely mitigated the price volatility historically associated with serious geopolitical events.

Still, some cautions are in order. First, U.S. energy security can’t be assumed. It takes long-range planning and investments, safe access to domestic resources, the ability to expand pipeline and export facility infrastructure, and a policy-level approach that anticipates unforeseen events that could affect global energy supply and have dire impacts on U.S. security, economic growth, and consumers.

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Ban on New Federal Development Would Risk U.S. Security, Jobs, Environment

federal lands  offshore oil production  policy  jobs  emission reductions 

Mark Green

Mark Green
Posted September 9, 2020

Four questions for proponents of policies that would effectively end new natural gas and oil development on federal lands and waters:

Where will the oil come from that won’t be produced here at home because of such a policy?

Where will nearly 1 million Americans find new work after this policy costs them their jobs?

What will Americans do without because of higher energy costs resulting from the policy?

How will the U.S. continue making environmental progress if increased coal use caused by the policy raises carbon dioxide emissions?

These and other questions are prompted by a new analysis projecting the effects of halting new natural gas and oil on federal lands and waters -- prepared for API by OnLocation with the U.S. Energy Information Administration's National Energy Modeling System, which EIA uses to produce its Annual Energy Outlook.

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Q&A: New Center for Offshore Safety Director Talks Responsibilities, Goals

center for offshore safety  safe operations  offshore oil production 

John Siciliano

John D. Siciliano
Posted May 20, 2020

Capt. Russell Holmes is the Center for Offshore Safety’s (COS) new director after serving for nearly three decades with the U.S. Coast Guard.

Holmes, who retired from the Coast Guard in 2020, takes over for Charlie Williams, who had led the center since 2012 after a long industry career. Holmes will be taking the center’s mission of offshore safety and environmental protection into its second decade of existence.

The center was created soon after the 2010 Deepwater Horizon incident in the Gulf of Mexico. Since then, the COS has enhanced the safety culture in offshore operations, while supporting federal regulations that mandate Safety and Environmental Management Systems (SEMS) at all operations on the Outer Continental Shelf.

Just prior to joining the center, Holmes served as the Coast Guard’s senior point of contact for offshore safety in the Gulf, overseeing marine inspection and investigation programs that ultimately support SEMS. As he explains in the Q&A below, Holmes says the industry’s professionalism and safety commitment matched his while he was serving as one of industry’s lead regulators.

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Black Gold. Texas Tea. TxOPEC?

oil production  texas  demand  supply 

Dean Foreman

Dean Foreman
Posted April 16, 2020

Amid talk in Texas of production quotas (“proration”) and other extreme policies that have been suggested to address the oil demand downturn, API’s Monthly Statistical Report (MSR) shows that supply is responding in real time and that U.S. crude and refined storage capacities have some flexibility to adjust to the COVID-19 driven demand decrease – helping to alleviate the need for blanket policies or government interventions.

Notably, recent federal actions may help provide additional flexibility to the entire energy value chain. For example, the U.S. Department of Energy’s opening of crude oil storage capacity within the Strategic Petroleum Reserve (SPR) to individual companies provides much-needed flexibility. Separately, Federal Reserve measures to either purchase corporate bonds or provide loans may perform additional triage for the energy industry and across the broader economy.

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The Perils of a Proposal to Prorate Texas Production

texas  oil production  demand  price of oil 

Mark Green

Mark Green
Posted April 13, 2020

We understand the oil demand-side circumstances that have led to calls for artificial market interventions such as tariffs and quotas – including a proposal before natural gas and oil regulators in Texas to mandate oil production cuts in the United States’ No. 1 oil-producing state.

Tough market conditions are no reason to implement bad remedies, such as the Texas proposal, which is problematic at best.

That’s not just an API view. Economics and history argue strongly against veering from the principle of markets dictating production levels, which is a core principle of our industry.

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U.S. Global Oil Leadership to Continue – Which is Great for Economy

oil production  us energy security  economic growth  consumers 

Dean Foreman

Dean Foreman
Posted February 26, 2019

In case you missed it, let’s echo a recent official U.S. Energy Department projection that the United States should “not only maintain its lead spot as top oil producer, but will greatly exceed what it produced last year in both 2019 and 2020.”

The trajectory of U.S. oil production is significant for U.S. economic growth, energy security and global leadership, and – as we recently discussed oil exports in this post – potentially raises the stakes in the market share battle between the United States and OPEC plus Russia (OPEC+).  

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A New Chapter in the U.S. Energy Revolution

oil production  us energy security  imports  global energy 

Mark Green

Mark Green
Posted January 18, 2019

The new Short-Term Energy Outlook from the U.S. Energy Information Administration (EIA) details the vigor of American crude oil production and strengthening U.S. energy security. This is good news for the economy, consumers and America's place in the world.

Consider that EIA estimates U.S. crude oil production averaged 10.9 million barrels per day (b/d) in 2018, an increase of 1.6 million b/d over 2017. EIA says production reached its highest level and had its largest volume growth on record.

EIA estimates crude oil and petroleum products net imports fell to an average of 2.4 million b/d in 2018, from 3.8 million b/d in 2017 – and 12.5 million b/d in 2005. And EIA forecasts that net imports will keep declining this year, to an average of 1.1 million b/d and to less than 0.1 million b/d in 2020. EIA forecasts that in the fourth quarter of 2020, the United States will be a net exporter of crude oil and petroleum products by about 0.9 million b/d.

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U.S. Energy Production Up, Emissions Down

crude oil  production  us energy security  emission reductions  epa ghg regulations 

Mark Green

Mark Green
Posted October 23, 2018

Two stat lines capture the essence of modern natural gas and oil development:

First, the United States produced a record 11 million barrels of oil per day (mbd) in September, 2.2 mbd more than September 2017, according to API’s latest Monthly Statistical Report (MSR). It’s a remarkable output number, given where domestic production was less than two decades ago.

Second point: Just as remarkable is the fact the United States’ world leadership in natural gas and oil production is accompanied by world leadership in cutting greenhouse gas emissions.

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Record Oil Output, Yet Dip in Petroleum Exports Suggests Tariffs’ Effect

crude oil exports  oil production  trade 

Mark Green

Mark Green
Posted August 16, 2018

Lots of positive energy data points in API’s newest Monthly Statistical Report – and one that’s potentially concerning.

The good is that the U.S. tied its record for crude oil production in July at 10.7 million barrels per day (b/d) and set a new one for natural gas liquids, 4.4 million b/d. With total liquids production up by more than 2 million b/d compared to July 2017, the U.S. has accounted for almost all of the growth in world oil production so far in 2018 – more than compensating for production losses elsewhere around the world.

Now the potential point of concern. The U.S. petroleum trade balance retreated in July, perhaps the result – at least in part – of trade tensions prompted by new U.S. tariffs. Crude export were down 240,000 b/d last month, and refined products exports decreased 220,000 b/d.

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Think: U.S. Oil, Increased Access to Boost Global Supply

crude oil production  access  us energy security 

Mark Green

Mark Green
Posted July 20, 2018

Big news in the latest API Monthly Statistical Report: U.S. crude oil production rose to an all-time record of 10.7 million barrels per day (mbd) in June – the largest monthly output, ever. According to the MSR, June domestic crude production increased more than 100,000 barrels per day over May, and the total was 1.6 million barrels per day more than June a year ago. But let’s go back to that top-line number – 10.7 million barrels per day – and comprehend what it means:

Economic growth and jobs – but also our country’s energy security, supporting the promise of present and future prosperity and opportunity. That’s the gift of the American energy renaissance that, well, keeps on giving.

All of the above support an argument that – to ensure an adequate global supply of crude oil upon which the U.S. and global economies rely – we should look to sustain and grow domestic natural gas and oil production. 

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