Energy Tomorrow Blog
Posted February 24, 2014
Energy Trade is a Key Part of Overall U.S. Trade Flows
EIA Energy Today: Energy trade has long been a key component of overall U.S. trade flows. Recent developments in U.S. energy production, notably the rapid growth of tight oil and shale gas output, are leading to significant changes in the nation's energy trade flows. Another important factor is consumption trends, which reflect both increased efficiency of vehicles and other energy-using equipment, and structural changes in the economy. This article, which focuses on current energy trade in the context of overall trade flows, will be followed by several others in the coming days that consider the evolution of trade flows in major energy fuel categories since 2002.
As shown in the figure above, overall U.S. trade includes both goods and services but is dominated by goods. In 2013, as in other recent years, the United States was a net importer of goods and a net exporter of services. Energy accounted for 15% of gross U.S. goods imports in 2013, while energy exports, which have grown significantly in recent years, accounted for 7% of overall U.S. goods exports. Focusing on the net U.S. trade position, shown by the black line in the chart above, net energy imports account for nearly half of the total U.S. trade deficit in goods and services.
Posted February 7, 2014
Big news from the Commerce Department this week is that U.S. exports rose to a new high in 2013 and imports dropped to their lowest level since 2009 for the smallest U.S. trade deficit since 2009 – thanks largely to reduced oil imports due to growing domestic production and record exports of products made from petroleum. The Wall Street Journal (subscription required) reports:
A booming domestic energy industry is largely responsible for the turnaround. Not adjusted for inflation, the value of petroleum exports—a category that includes gasoline, kerosene, lubricants, solvents and other products—reached a full-year peak in 2013. Petroleum imports, by value, were the lowest since 2010 and the volume of crude-oil imports, at 2.8 billion barrels, were the lowest since 1995.
Bloomberg reports the U.S. trade gap narrowed to $471.5 billion last year from $534.7 billion in 2012, with the trade balance on petroleum products shrinking to 20.2 percent, the biggest decline in four years.
Posted February 6, 2014
Trade Gap Shrank in 2013 as U.S. Fuel Exports Climbed
Bloomberg News: The U.S. trade deficit in 2013 was the smallest since 2009, even as it ticked up at year’s end, as rising fuel exports and falling imports propelled the world’s biggest economy further toward energy independence.
The gap narrowed to $471.5 billion last year, the lowest since 2009, from $534.7 billion in 2012, figures from the Commerce Department showed today in Washington. The balance on petroleum products shrank 20.2 percent, also the biggest decline in four years.
Foreign sales went beyond fuel as demand for American-produced foods, capital equipment, autos and consumer goods all climbed to records in 2013, evidence of the rebound in global demand that will probably keep driving exports this year. Another report showing claims for jobless benefits dropped last week points to a healing in the U.S. labor market that will help boost consumer spending, ensuring imports also grow.
“The trade deficit will continue to narrow a bit over the course of 2014, mostly thanks to a smaller petroleum trade deficit,” said Ryan Wang, an economist at HSBC Securities USA Inc. in New York and the second-best trade forecaster over the past two years, according to data compiled by Bloomberg. “We’ll see another year of moderate growth.”
Read more: http://bloom.bg/1lDQLmp
Posted January 23, 2014
The U.S. energy revolution continues to reshape America’s energy outlook for the better. Thanks largely to shale energy reserves and advanced hydraulic fracturing and horizontal drilling, the U.S. Energy Information Administration’s 2014 Annual Energy Outlook estimates domestic oil production will approach 9.6 million barrels per day by 2016 – a level of output not seen since 1970. EIA also projects that U.S. liquid fuels net imports as a share of consumption will decline to about 25 percent in 2016, down from a high of 60 percent in 2005. Both are great pieces of news.
Posted January 8, 2014
Two big stories have caught our attention the past two days. First, America’s trade deficit has sunk to a four-year low thanks to falling U.S. imports and increasing exports:
- America’s Trade Deficit is Shrinking. Thank Fracking. http://wapo.st/1cB2eMg
- U.S. Growth Picture Brightens as Exports Hit Record: http://on.wsj.com/K71y72
- Trade Deficit Falls to 4-Year Low: http://lat.ms/1cP1AYf
- How the Booming Oil Patch Helps U.S. Trade: http://buswk.co/1lBmfXY
And second, the growing number of voices calling for ending the decades-old ban on U.S. crude oil exports:
- Murkowski Joins Growing Chorus Calling to Lift Ban on Crude-Oil Exports: http://bit.ly/1eHRzze
- Is Free Trade in Energy Finally on the Horizon? http://bit.ly/1cZzu0W
- U.S. Chamber CEO – End Ban on Crude-Oil Exports: http://bit.ly/1dgBjZ3
Posted December 26, 2013
Though there are compelling, Economics 101-type reasons the U.S. should lift its dated ban on crude oil exports and help clear the way for the export of U.S. liquefied natural gas (LNG), opponents of both continue to misunderstand the way global energy markets work – as well as the significant benefits accruing to the United States from free trade.
You’ve probably heard the rhetoric: Keep American oil and natural gas locked up here at home for U.S. consumers.
This misses the essential fact that crude oil is traded (and priced) globally, and that limiting LNG exports will only limit U.S. participation in an important, developing market – while effectively denying our country the infusion of overseas wealth in exchange for valuable American commodities.
Posted December 20, 2013
Momentum is building for revisiting decades-old restrictions on U.S. exports of oil and natural gas. For months we’ve talked about the benefits of exporting liquefied natural gas. Now the U.S. ban on crude oil exports also is being discussed. Earlier this month Energy Secretary Ernest Moniz said much has changed since the crude oil export ban was created:
“Those restrictions on exports were born, as was the Department of Energy and the Strategic Petroleum Reserve, on oil disruptions. There are lots of issues in the energy space that deserve some new analysis and examination in the context of what is now an energy world that is no longer like the 1970s.”
Meanwhile, the Wall Street Journal (subscription required) and the Washington Post have called for an end to the crude oil export ban. With the U.S. Energy Information Administration’s newest outlook projecting continued growth in U.S. production of oil – nearing the 1970 record of 9.6 million barrels per day – and natural gas, discussion of exporting American energy makes economic sense.
Posted December 19, 2013
More from the U.S. Energy Information Administration’s preview of its 2014 Annual Energy Outlook, released this week. EIA’s projections depict a United States gaining more control of its energy security with increased domestic oil and natural gas production. Let’s zero in on some of the things EIA says about natural gas.
First, domestic natural gas production is skyrocketing, thanks to output from shale.
Posted December 13, 2013
There’s much to mine from ExxonMobil’s 2014 energy outlook, but here’s a quick analysis: In a world of increasing energy demand, the future looks brightest for countries that have significant energy reserves, modern industries that can find and produce from those reserves and policies that allow them to be major players in the global marketplace. For the United States that would be check, check and … check back later.
ExxonMobil’s William Colton and Kenneth Cohen highlighted the annual report that looks to global energy demand and supply out to the year 2040. Key projections and charts:
Demand – The world’s energy demand is expected to increase 35 percent over 2010 levels by 2040. Most of the demand growth will come from the developing world. ExxonMobil projects flat demand growth in developed nations despite expanding economies due to technology and energy-use efficiencies.
Posted December 4, 2013
A Pivotal Moment in U.S. Energy History
Global Energy Initiative (Jason Bordoff): We are at a transformational moment in energy history. Just a few years ago, all energy projections forecast increased imports, increased scarcity, and increased natural gas prices. Today, we’ve shifted from scarcity to abundance. U.S. oil production has increased by 2.5 million barrels per day (B/D) since 2010. This year, the United States overtook Saudi Arabia as the largest producer of liquid fuels (including crude oil, natural gas, and biofuels) in the world. U.S. oil imports are at their lowest level in 25 years and are projected to continue declining. The natural gas outlook is even more striking. New geological surveys and production data continue to surprise to the upside. And multi-billion-dollar terminals proposed not long ago to import natural gas are being flipped to export instead.
This transformation is not only a U.S. story. New technologies mean that what were once challenging sources of oil and gas can now be tapped economically from the oil sands in Canada (and potentially Venezuela), the ultra-deepwater “presalt” off the coast of Brazil, and many other parts of the world. Iraq, parts of Africa, and elsewhere are poised for sharp increases in production.
Read more: http://bit.ly/1gk7ms9