Energy Tomorrow Blog
Posted September 20, 2018
In API’s latest Industry Outlook and Monthly Statistical Report, we have shifted from recognizing risks on the horizon to having a line of sight on some of them. The effects of trade disputes in particular have become tangible.
Most notably, at the same time as the U.S. celebrated another new record for crude oil production of 10.8 million barrels per day (mb/d), U.S. petroleum exports decreased by 1.3 mb/d over the past two months.
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.
Posted August 8, 2018
A couple of observations on China’s announcement late last week that it may impose a 25 percent tariff on U.S. shipments of liquefied natural gas (LNG) to that country – which would be in retaliation for announced U.S. tariffs on certain Chinese goods coming into this country.
First, China was the third-largest importer of U.S. LNG in 2017, accounting for nearly 15 percent of our LNG exports, according to the U.S. Energy Information Administration (EIA). As those numbers indicate, this exchange of tariffs could leave a mark as far as U.S. energy exports are concerned. ...
If U.S. energy exports are restricted – at the same time trade policies have been adopted that increase the cost of the steel our industry uses – there’s a risk of significantly affecting a sector that has been a driving force for economic growth. It’s a big price to pay.
Posted August 7, 2018
Recently, we discussed how natural gas and oil production and energy exports were major contributors to robust second-quarter growth by the U.S. economy – by themselves generating nearly half of the increase in U.S. real exports in Q2.Yet, there’s concern that escalating U.S. trade restrictions and looming disputes could threaten global trade and economic growth. We’ve talked about tariffs and quotas directly impacting the natural gas and oil industry – China last week announced a 25 percent tariff on U.S. liquefied natural gas – but the potential effect is broader than just our industry, as indicated in last week’s post on possible food price impacts.
Posted July 27, 2018
The U.S. gross domestic product (GDP) increased 4.1 percent in the second quarter at a seasonally-adjusted annualized rate, its best pace since 2014, driven by strong consumer and business spending as well as a surge in exports ahead of retaliatory tariffs from China. As the energy renaissance has continued to raise U.S. natural gas and oil production and exports to record levels, these abundant and affordable fuels and feedstocks contribute to the economy and — by themselves — generated nearly half of the growth in U.S. real exports in Q2.
Posted June 20, 2018
Two charts pretty well capture the what’s at stake for U.S. energy – specifically exports of domestic crude oil – in an intensifying trade standoff between the United States and China.According to U.S. Energy Information Administration figures, this is a very big deal. Big as in U.S. crude oil exports to China accounted for about one-fifth of all U.S. oil exports in 2017 – growing from basically nothing in 2013 to 81.6 million barrels last year.
Posted June 14, 2018
With Wall Street Journal headlines such as “Trans-Atlantic Oil-Price Spread Soars as Supply Glut Disappears,” it might be hard to remember that the United States’ domestic oil production stood at a record 10.5 million barrels per day (mb/d) in April, and the nation’s petroleum trade balance is in its best position in 50 years. This has reinforced U.S. energy security, lowered the trade deficit and boosted economic growth.
That said, given our country’s much improved energy outlook, some may question why we’re still importing crude oil and refined products. And, while we’re still importing oil, why do we export domestic crude – especially when prices have risen at the pump? Why don’t we just keep American oil at home? ...
Answers are found in an understanding of basic market realities.
Posted June 13, 2018
The U.S. Energy Department’s latest study on the economic impacts of exporting liquefied natural gas (LNG) reaches a by-now familiar top-line conclusion: Exporting U.S. LNG is good for the economy, and those benefits will outweigh domestic cost impacts.
We say familiar, because this is the fifth DOE study on LNG exports – and the fifth to describe broad, positive economic impacts for the United States from shipping natural gas to friends and allies overseas – which should end claims that LNG exports could harm American consumers.Certainly, no one can say the issue hasn’t been thoroughly analyzed – not after five government studies and two commissioned by our industry (see here and here).
Posted March 27, 2018
The U.S. Energy Information Administration reports that the U.S. has become a net natural gas exporter for the first time since 1957 and that exports of liquefied natural gas (LNG) quadrupled in 2017 over 2016. Here's why these developments are important for the United States.
Posted March 12, 2018