Energy Tomorrow Blog
Posted October 27, 2015
Reports by Bloomberg and others say that White House and congressional budget negotiators would sell oil from the Strategic Petroleum Reserve (SPR) to partially pay for their new budget agreement. Sales would total 58 million barrels from 2018 to 2025, according to a draft House bill (see Section 403-a).
How much money would be raised from the sales would depend on prices at the time of the sales. But, if the goal is generating revenue for government to fund worthy projects, rather than a series of one-time sales, why not lift the ban on U.S. crude oil exports and create an annual revenue stream?
According to a study by ICF International (Page 86), ending the 1970s-era oil exports ban would lift the U.S. economy, create jobs – and generate significant additional revenue for government. A number of other studies mirror ICF’s findings on the economic benefits from lifting the export ban. We highlight ICF here because its estimate of additional oil production from lifting the ban (up 500,000 barrels per day) is almost identical to the output increase estimated by the U.S. Energy Information Administration (470,000 barrels per day). ICF:Federal, state, and local governments benefit from crude oil exports both in terms of the generation of GDP, which is then taxed at these levels, but also through royalties on federal lands where drilling takes place. Total government revenues, including U.S. federal, state, and local tax receipts attributable to GDP increases from expanding crude oil exports, could increase up to $13.5 billion in 2020.
Posted September 1, 2015
Some quick points from the new crude oil exports study from the U.S. Energy Information Administration (EIA):
First, like a series of other studies before it, EIA’s study finds that lifting America’s 1970s-era ban on exporting domestic crude oil would not negatively affect U.S. consumers. EIA says:
Petroleum product prices in the United States, including gasoline prices, would be either unchanged or slightly reduced by the removal of current restrictions on crude oil exports.
EIA projects that ending the export ban – which would allow shut-in domestic crude to access global crude oil markets – would spur more domestic production. Then the global supply/demand would become “looser,” putting downward pressure on global crude prices, resulting in “lower petroleum product prices for U.S. consumers.
Posted August 5, 2015
New government stats on falling carbon dioxide (CO2) emissions from electrical power generation point to a good-news story on energy and climate, one that should grab the attention of policymakers nationally and in the states. This is seen in data from the U.S. Energy Information Administration (EIA).
Plotting CO2 emissions from the electric power sector from 1988 to this April, EIA reports emissions hit their lowest point for any month in 27 years. This is largely because of increased use of natural gas in power generation – a market choice that’s based on the availability and affordability of natural gas, as well as the fact it is clean-burning.
Posted June 19, 2015
The issue was energy infrastructure – where the United States is and where things are headed. At the U.S. Energy Information Administration’s (EIA) annual conference this week, one discussion honed in on the challenges to infrastructure approval and construction – as well as government’s best role in developing projects that are key to U.S. energy transport and overall energy security. The latter produced some friction between speakers not often seen at conferences like EIA’s. More below.
The U.S. Energy Department’s Melanie Kenderdine talked about some of the details in the department’s recently issued Quadrennial Energy Review (QER), which focused on ways to modernize the nation’s infrastructure.
Posted June 4, 2015
CNBC – The U.S. Environmental Protection Agency said in a Thursday report that it found no evidence fracking has a “widespread” impact on drinking water.
The EPA report concluded that there are above and below ground mechanisms by which fracking have the potential to impact drinking water resources, but that the number of identified cases were “small” compared to the number of fracking wells.
“We did not find evidence that these mechanisms [of potentially affecting water] have led to widespread, systemic impacts on drinking water resources in the United States,” the report said.
Posted April 14, 2015
The U.S. Energy Information Administration’s (EIA) new Annual Energy Outlook for 2015 contains a number of stats, charts and projections, but you could boil them down to a couple of important points.
First, oil and natural gas are and will continue to be the foundation of an all-of-the-above energy approach that’s key to continued U.S. economic growth, energy security and overall security. EIA says oil (36 percent) and natural gas (27 percent) supply 63 percent of America’s energy now, and EIA projects they will supply 62 percent in 2040 (oil 33 percent and natural gas 29 percent). This is because oil and natural gas are high in energy content, portable and reliable. They’re the workhorse fuels of the broader economy, making modern living possible as fuels and as the building blocks for a number of products Americans depend on every day. America is and will be dependent on a variety of energies, but oil and natural gas are and will play leading roles.
The great news is the U.S. is in the midst of a revolution in domestic oil and natural gas production, leading to a second big takeaway from EIA’s report – that domestic output is and will continue to reduce U.S. dependence on imported energy.
Posted April 7, 2015
Following on yesterday’s post on increased domestic energy production that is backing out imports, we see that the U.S. remained No. 1 in the world in the production of petroleum and natural gas hydrocarbons last year, according to the U.S. Energy Information Administration (EIA).
The government agency responsible for quantifying all things energy says that U.S. oil and natural gas production has been trending higher than the output of Russia and Saudi Arabia, the second- and third-largest producers:
Since 2008, U.S. petroleum production has increased by more than 11 quadrillion British thermal units (Btu), with dramatic growth in Texas and North Dakota. Despite the 50% decline in crude oil prices that occurred in the second half of last year, U.S. petroleum production still increased by 3 quadrillion Btu (1.6 million barrels per day) in 2014. Natural gas production—largely from the eastern United States—increased by 5 quadrillion Btu (13.9 billion cubic feet per day) over the past five years. Combined hydrocarbon output in Russia increased by 3 quadrillion Btu and in Saudi Arabia by 4 quadrillion Btu over the past five years.
Posted April 6, 2015
Statistics in the U.S. Energy Information Administration’s Monthly Energy Review for March show U.S. domestic energy production meeting about 89 percent of the country’s total energy demand. That’s up from 84 percent in 2013 and 2012 and reflects a key result of the domestic energy revolution: growing U.S. self-sufficiency.
EIA data shows U.S. energy production as a percentage of total demand. Total energy production (fossil fuels, nuclear electric power and renewables – again, as a percentage of total U.S. energy demand -- was about 69 percent in 2005, and it grew to about 89 percent last year. The share of fossil fuels (oil, natural gas and coal) accounted for approximately 55 percent in 2005, growing to about 70 percent last year.
Posted April 3, 2015
A couple of data points and some observations on energy security.
First data point: The U.S. Energy Information Administration (EIA) reports that last year the United States enjoyed the largest volume increase in crude oil production since record keeping began in 1900. That’s right, the largest increase in 115 years!
Production of crude (including lease condensate) increased during 2014 by 1.2 million barrels per day to 8.7 million barrels/day. EIA says that on a percentage basis 2014’s output increased 16.2 percent, the highest growth rate since 1940.
You can thank shale and fracking.
Posted February 10, 2015
EIA Today in Energy: The increase in U.S. shale and tight crude oil production has resulted in a decrease of crude oil imports to the U.S. Gulf Coast area, particularly for light-sweet and light-sour crude oils. These trends are visualized in EIA's crude import tracking tool, which allows for time-series analysis of crude oil imported to the United States.
Historically, Gulf Coast refineries have imported as much as 1.3 million barrels per day (bbl/d) of light-sweet crude oil, more than any other region of the country. Beginning in 2010, improvements to the crude distribution system and sustained increases in production in the region (in the Permian and Eagle Ford basins) have significantly reduced light crude imports. Since September 2012, imports of light-sweet crude oil to the Gulf Coast have regularly been less than 200,000 bbl/d. Similarly, Gulf Coast imports of light crude with higher sulfur content (described as light-sour) have declined and have been less than 200,000 bbl/d since July 2013.