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U.S. Crude Oil Production, Exports Hit Record Levels

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Just a reminder that our economy has a major stake in the growth of our Oil Production,

 

Mar 1, 2019, 09:26am

 

U.S. Crude Oil Production, Exports Hit Record Levels

 

Jude Clemente

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EnergyI cover oil, gas, power, LNG markets, linking to human development.

 

 

Up 140% since the shale revolution took flight in 2008, the U.S. has seen a meteoric rise in crude oil production.

 

U.S. crude and product exports should be consistently outpacing imports starting in 2020

 

The numbers continue to amaze and surpass all expectations from even the most well-financed banks and modelers.

 

U.S. crude oil output was long thought to have peaked back in 1970 at just under 9.7 million b/d.

 

Now, EIA estimates that we have touched 12 million b/d for the week ending February 15.

 

 

This surge has continue to obliterate "Peak Oil" theory, the stories of which topped out in July 2008 when oil prices hit a whopping $145 per barrel.

 

Some 11 years later, "Palin Was Right: 'Drill, Baby, Drill!'" The subsequent U.S. shale boom has loosened the market, and oil and gasoline prices have collapsed.

 

Since the start of 2018 alone, U.S. crude oil production is up nearly 30%, even more impressive since prices are down 12-15% over that time.

 

This has helped push U.S. crude oil exports to historic levels as well, just surpassing the 3.6 million b/d mark the same week output hit a record.

 

U.S. crude sellers have been bolstered in recent weeks by a $8-10 per barrel discount for the U.S. WTI crude grade as compared to the Brent international benchmark. They can generally make money when the spread is $3-5. The gap has been in the $7-12 range since August.

 

Moreover, U.S. shale oil is a lighter, sweeter grade, and our refinery system is mostly built to process heavier, more sour kinds, so we have a surplus to ship abroad. This light oil is especially suitable to make gasoline. Yearly global car sales have soared to above 90 million, up 30% since 2010.

 

And production cuts from OPEC have also pushed more market share our way. OPEC, Russia, and the nine others coordinating production cuts to lift prices have been of great assistance to U.S. shale drillers. This explains why DOE Secretary Perry continues to warn against the punitive "NOPEC" bill circulating on Capitol Hill.

 

 

Yet, most formally installed in June 2018, the trade war with China has been a key problem for our industry. China has not put a tax on U.S. crude but purchases have still plummeted. Up until June, China had accounted for over 20% of all U.S. crude exports. That has now sunk to zero.

 

Trade talks are progressing, however, and U.S. shippers remain optimistic on quickly restarting sales to the world's largest oil importer. U.S. crude is now "trickling" back into China.

 

We better get this right President Trump: despite the committment to lower national production by 4-5% to 9.8 million b/d from January to March, the Saudis are still looking to up oil sales to China 50% this quarter.

 

South Korea and India have helped compensate, now taking in a third of U.S. crude exports. Canada receives about 20%.

 

There is no end in sight: U.S. output could hit 14 million b/d and exports 5 million b/d in just a few years.

 

We are indeed transforming the global oil market, something that the anti-oil business always claimed was impossible since we only account for 12-15% of the world's total supply. We will continue to account for the bulk of new global production, perhaps as high as 85% of incremental output over the next five to seven years.

 

Exports remain an essential outlet for the U.S. oil industry in this time of very high but not growing domestic demand (~20 million b/d). To reach full potential, however, we require more pipelines and deeper and wider ports along the Gulf of Mexico to access bigger crude carriers.

 

U.S. crude and product exports should be consistently outpacing imports starting in 2020.  END

 

The President signed a signifigant Positive Veterans Bill this afternoon.

 

 

 

 

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So why are we still giving these huge multi national oil corporations subsidies?

 

If we have sooooooooo much of it why are we still using ever higher ethanol blends?

 

Why are we importing any crude at all?

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1 hour ago, Gotcow? said:

So why are we still giving these huge multi national oil corporations subsidies?

 

If we have sooooooooo much of it why are we still using ever higher ethanol blends?

 

Why are we importing any crude at all?

The importation is shrinking, and our oil and Nat. Gas are pushing Export oil and gas to the top of who got the biggest and cleanest power for sale.

 

Look at our lower fuel prices GC!

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Y'all righties wanna sell all our *surplus* shale oil before other countries even start to develop theirs?  I never saw the advantage in that.   :headscratch:

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18 mins ago, patchyfog said:

Y'all righties wanna sell all our *surplus* shale oil before other countries even start to develop theirs?  I never saw the advantage in that.   :headscratch:

Patchy, if you believe in alternative as the future, then you should want to sell the chit out of fossil fuels now before alternative-driven demand declines reduce prices globally. Sell it while it is hot so to speak. 

 

You do believe in alternatives, right? 

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Posted (edited) · Report post

Don't waste your time, far too brainwashed

Trump could create and fund the agency that cures cancer and he and anything he does will still be "Orange Man Bad"

Edited by Sudsy

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6 mins ago, tomkaz said:

Patchy, if you believe in alternative as the future, then you should want to sell the chit out of fossil fuels now before alternative-driven demand declines reduce prices globally. Sell it while it is hot so to speak. 

 

You do believe in alternatives, right? 

I think ya need to consider all kinds of alternatives (my list includes fission nuclear), if ya want to cap, minimize, or reduce CO2 emissions.

 

 

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