US Oil Exports Hit Record Pace. That's Right, Exports
Who knew that the US is currently exporting 1.8 million barrels of oil a day?
To make sure everybody does, Rep. Edward J. Markey (D-Mass.), Chairman of the Select Committee on Energy Independence and Global Warming, sent a public letter to President Bush, asking him to "keep our oil at home."
The letter didn't specify how, but it didn't miss the opportunity to take a shot at the GOP plan to open up protected offshore waters to oil drilling.
.....at the current export rate, by the time the first barrel of oil could be produced from increased offshore drilling, America would have already exported the equivalent of nearly 40 percent of the oil that is projected to lie beneath protected areas offshore.
It was no coincidence that Markey's letter was released just as John McCain paid a visit to an offshore rig off the coast of Louisiana -- in order to highlight his support for increased domestic offshore drilling.
As the public battle over access to oil in protected US waters continues, Jad Mouawad in the New York Times explains why the stakes have gotten so high: it turns out the major oil companies, desperate for new sources of supply, have almost nowhere else to turn.
And after reading this story on Think Progress, it will also become clear why a McCain election victory would deliver what the oil companies want more than anything else: a clear path to an endless fossil future.
Mouawad reports that as late as 1970s, the major oil companies were responsible for 50% of global oil production. Today, their production accounts for a mere 13%. That's because the 10 largest holders of petroleum reserves are state-owned companies.
Oil company executives see a straightforward explanation: a trend known as resource nationalism. They contend that they have been shut out of promising regions by a rising assertiveness in the Middle East, in Russia, in South America and elsewhere by governments determined to keep full control of their oil.....
This sense of being hemmed in helps explain why the Western oil companies want more offshore drilling in the United States. They see it as one of their few options.
And it's a lot easier for these oil companies to influence US government policy than the decisions of Russia's Gazprom, or Iran's national oil company, or Venezuela.
And it looks like they've got the McCain campaign in a bear hug. Think Progress reports that Wayne Berman, McCain's national finance co-chairman, who has bundled over $500,000 for his campaign, has lobbied for Chevron since 2004; McCain's chief Congressional liaison, John Green, has lobbied for Chevron since 2005; and Richard Hohlt, a McCain fundraiser and DC insider, has also lobbied for Chevron since 2005.
It should come as no surprise that the McCain campaign chose to visit a Chevron-owned drilling platform.
All this also explains why the battle over offshore drilling is just the leading wedge of an effort to remove government restrictions on the exploitation of unconventional fossil fuels: tar sands, oil shale and coal-to-liquid fuels.
With access to global oil fields more restricted than ever, the oil companies are not going to be satisfied with the meager pickings from offshore wells. They're after the mother lode, which both McCain and President Bush identified in their calls for increased domestic oil production: "tap into the extraordinary potential of oil shale."
Oil shale is a type of rock that can produce oil when exposed to heat or other processes. In one major deposit - the Green River Basin of Colorado, Utah, and Wyoming - there lies the equivalent of about 800 billion barrels of recoverable oil. If it can be fully recovered, it would equal more than a century's worth of currently projected oil imports.
Ladies and gentlemen, welcome to the endless fossil future. And never mind about all those US oil exports, or the horrors of oil shale production, the dirtiest fuel on the planet.
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Not only do we export 1.8 million barrels of our oil (from our public land) a day, but we can thank the Republicans for selling their soles to Detroit by lowering fuel efficiency requirements and refusing to enforce the few rules we do have! It's a fact that US made vehicles get 20% (+) less mileage than that which is posted on their sales specs. It's no wonder the Japanese are so successful in vehicle sales to us. Just another case where our leaders just don't get it! For millions in their own political pockets, we have suffered billions and billions in losses to our auto industries! Doesn't anyone remember the Alaskan oil line? That oil too was supposed to come directly to the American people - DID NOT! The oil companies drilled our public lands and sold most of the oil to the Japanese. I was around then and I don't remember this having been one of the reasons for allowing private drilling on our public lands. America does need oil but don't let them lie to you. We'll never get a fair shake for our oil if these guys are in charge and our public lands contain the last of what our citizens have a right to.
Can you provide some evidence that we're selling Alaskan oil to the Japanese? Check out Jvarga's post below that shows we only export about 500,000 barrels a day of crude to Canada.
I propose that the Democrats add an amendment I call the "Domestic Market Initiative" to any offshore-drilling bill. It would simply require that any domestic production go directly to the domestic market, with a preset price of $100 per barrel.
There are two big scams the Republikans are pushing: 1.) That the granting of the offshore leases would make a short-term difference in the price of gasoline (it won't because it takes 15 years before the first gallon of gasoline is produced); and 2.) That domestic production would somehow add to our domestic supply (it won't, because the world oil market is unified, and oil goes to the highest bidder--which is the reason the US is exporting oil now when it is needed at home).
The "Domestic Market Initiative", if passed, WOULD make a real difference, because it would be guaranteed to instantly redirect millions of barrels of production to Americans instead of foreign markets. It would also hammer the oil corporations' profits, which means that it would be fought tooth-and-nail by the Republikans. Which in turn would expose them for what they are--shills for oil pigs who really care not a whit about what happens to Joe Pickup.
Why not?
"Why not?"
Because you obviously did not read the posts below which show (physical evidence included) that we do not export domestic oil with exception of low grade products that we simply do not need (while other nations like Canada do need them and are willing to pay good money for them).
Not every complex problem in this world has a simplistic solution. Actually, none of them do. In this case you simply fell for a political scam because you would like the pain at the pump to go away without actually using the correct solution: conservation.
Check out some of the comments below. In general we don't export much crude oil. A few hundred thousand barrels a day goes to Canada (based on physical location), which in general is not a bad thing since they're sending us most of their production anyway. We export refined products that don't meet our needs (not every gallon of crude oil can be turned into US grade gasoline).
I really don't think this would be an issue at all. The US has the refinery capacity to process the types of crude we are likely to find on the Eastern Seaboard and in ANWR. The US is the biggest market in the world. I don't even think oil companies would balk at the $100/price roof, as long as it was pegged to inflation. They simply won't develop any fields that would not be economical based on $100/barrel oil. In short, they would be happy to get some additional domestic opportunities.
Also, domestic drilling is not just about oil, it's about natural gas. Unless we find some whopping discoveries that would warrant the building of LNG export facilities for European or Asian markets, all of the Natural gas found will definitely end up in the US. We don't have the facilities to export natural gas here in the US to anywhere outside of North America (then only through pipelines to Canada or Mexico perhaps, but not likely).
Also, it would not hammer profits in any way shape or form . . . There's no need to export crude oil to make a profit. And the US is going to need more oil than it can produce domestically for the forseeable future. I also don't see why Republicans would have a major problem with it.
The exports are all distillates --diesel fuel. Refining companies are refining diesel because the margins are much higher than for gasoline; margins are higher because of huge diesel demand abroad, not here in the US, thus they export it. Gasoline margins have been low ($5 a barrel in the last weeks) and refining companies have to get margin somehow or risk losing a lot of money or even going out of business (some companies are particularly vulnerable because of high debt levels).
Are we sending oil to Canada because we do not have enough refineries here in the US?
We are sending petroleum products to other nations because they use more diesel and heavy fractions and we use more gasoline. The ratio between diesel and gasoline fraction is not very flexible for a given quality of oil. If the amounts we need do not match the amounts we have, we sell the overstock.
According to
http://tonto.eia.doe.gov/dnav/pet/pet_move_expc_dc_NUS-Z00_mbbl_m.htm
of the 55 million barrels per month (i.e. 1.8 million barrels a day), we are sending 15 million barrels of distillate fuel oils (different grades of diesel) and 12 million barrels of residual fuel oils (bunker oil) and 11 million barrels of petroleum coke (black solid staff used to make graphite electrodes and such, i.e. the stuff that is left after you cook all the lighter fractions out in our refineries).
So to me it looks like the people who write headlines like these just don't want to understand that oil and petroleum products are not the same. And why should they? Isn't it easier to assume the worst (they are selling our oil while ripping us off) than to turn on the brains and start thinking about the finer details of petroleum chemistry. One might even get a headache doing that...
Certainly there is demand for diesel in the US. The US military, the overwhelming majority of commercial trucks, maritime, not to mention personal vehicles.
There is enough refining capacity in the US. Some in the media say a new refinery hasn't been built in the US since the 70s but don't realize that significant capacity has been added to existing refineries since that time, enough to equal the increase in demand.
I have a question that has been bugging me about what we can and cannot sell to Americans, at inflated rates.
here is what I heard: If oil is produced domestically, there is a law that does not allow the sale of that oil to americans at inflated rates. Some kind of cap/tariff etc....
So, why would an oil company sell US our own oil, if it can get better prices exporting it?
Conversely, there is NO limit to how much oil companies can gouge US citizens, as long as the oil is IMPORTED...
So what we have here is total incentive to ship OUR oil elsewhere, and make the consumer buy imported oil, to maximize profits.
Is this true? Did our oil companies decide it is better to ship ALL OIL halfway around the world, rather than use our own oil, be our own masters, and maybe make a little less (even as you have savings from NOT SHIPPING so far)?
Oil is not all the same quality of oil. Petroleum products are not oil. We don't need all qualities of oil at the rate at which we produce them and we do not need all fractions of petroleum distillation process at the rate they are left over when we make the quality of gasoline we need. What's left that we don't need at home, we send to other countries. We could, of course, just make a huge lake of a flammable tar-like substance somewhere... it would be an environmental and economic disaster of highest order... but at least nobody could get the dirtiest parts of OUR oil to do something useful with it. Wouldn't that be great?
Ok, looks like he's using the DOE data: 581,000 barrels of crude oil exported in May 2008 (1.8million per dayish). If you look at that data for export destination, 100% of it goes to Canada.
I don't think the details aren't really important, but it would have been nice to see some precision in reporting the numbers since the details are readily available.
tonto.eia.doe.gov/dnav/pet/pet_move_exp_dc_NUS-Z00_mbbl_m.htm
and
tonto.eia.doe.gov/dnav/pet/pet_move_expc_a_EPC0_EEX_mbbl_m.htm
I may have missed it in the post (if so I apologize) but where's the source for the 1.8 million barrels per day statement?
I'm curious because the DOE page shows about 1.5 million barrels of crude oil AND petroleum products exported per day, but only 27 thousand barrels of crude oil oil per day. Which goes to canada refineries before finding its way back here.
See David Sassoon's Profile
Markey is the source and he's engaging in polemics that are as lacking in detail as the claim that offshore drilling will bring down gas prices. It was his contribution to the sound bite war while McCain was visiting the Chevron rig.
You're still trying to drum up the misperception that crude oil produced from domestic drilling expansion would not end up in the US. This is really not a plausible argument. Oil costs money to transport, and the biggest market in the world is right here in the USA. Crude oil is not likely to leave the country. Refined products (which the US cannot consume in many cases, such as higher sulfur content fuels) are exported for sale (which is the right of refiners and the only thing that makes them profitable).
Jvarga found some good hard numbers that show half a million barrels going to Canadian refineries. The other 1.3MM barrels are refined products that the US market cannot consume. If you're going to knock others for not being transparent, than don't pick your post headlines and "facts" to throw shadows.
Oil company executives see a straightforward explanation: a trend known as resource nationalism. They contend that they have been shut out of promising regions by a rising assertiveness in the Middle East, in Russia, in South America and elsewhere by governments determined to keep full control of their oil.....
Smart countries. Unlike us... who give our naitonal natural resources to private industries... who then ship them off overseas... and charge us an arm and a leg to buy them back... and keep their profits high. While I don't think every industry should be nationalized... I do think energy (including any "new alternative" energy) should be nationalized.
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