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Oil Production Facts

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How Does The United States Fit Into the World Oil Market?

How much oil does the United States produce? How much do we consume? Where does the imported oil come from?

The rapid increase in crude oil prices over the past couple years has had a huge impact on the finances of individuals, families, businesses, and the economy at large. The rise in crude oil has had follow on impacts on virtually every sector of the economy, particularly energy and transportation dependent industries.


With such a large portion of the population impacted, it is understandable that everyone has an opinion on how to "Fix" the problem. Some of those potential fixes include offshore drilling, opening up ANWR, conservation, developing shale oil, converting coal to oil, using more natural gas, developing alternative energies, and biofuels to reduce our need for expensive oil. There is nothing better than a spirited debate on a critical issue like domestic energy policy, but I worry that too much of the public discourse has been highly partisan, overly simplistic, and not necessarily grounded in reason.


This page is the first of several planned pages that, as a whole, will provide a reasoned, fact based assessment of the current US and worldwide energy market. The focus of this page is an overview of current US and Worldwide petroleum production and consumption, US petroleum imports and their impact on the US trade deficit.

The United States is the Third Largest Petroleum Producing Nation on the Planet (Really)

... More than Iran, Iraq, Kuwait, and the United Arab Emirates

Lets get started by taking a look at the petroleum production rates for the major oil producing nations.
























2006 Statistics from the United States Energy Information Administration (EIA)
Source: tonto.eia.doe.gov/country/index.cfm

**NOTE: This table refers to the production of all petroleum products including crude oil. Other sources of petroleum products are refined crude oil and liquids captured from natural gas wells. The evaluation of petroleum production, consumption, and imports appears to give a more complete picture of the worldwide oil/petroleum industry

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However, the United States Consumes Far More Oil Than Any Other Nation

(Frankly, it is not even close)

      A comparison of the Petroleum production and consumption data for the United States clearly indicates the scale of the US production-consumption gap. While the Unites States produces over 8 million barrels of petroleum products a day, we consume over 20 million barrels a day. Our daily import needs exceed the entire production of either Russia or Saudi Arabia, numbers 1 and 2 in oil production.

























2006 Statistics from the United States Energy Information Administration (EIA)Source: tonto.eia.doe.gov/country/index.cfm

Where Does The United States Import Additional Oil From?

* There Might Some Surprises on this List *

With the magnitude of the US oil import needs, it should be readily apparent that our country is very vulnerable to any large scale supply disruptions in the world petroleum market. The table below shows what nations we depend upon for imported oil. Due to proximity, Mexico, Canada, and Venezuela are major sources of imported oil.



























Source:
http://www.eia.doe.gov/pub/oil_gas/petroleum/data_publications/company_level_imports/current/import.html

How Does All of This Imported Oil Impact the Trade Deficit?

The simple answer is that imported petroleum makes up a substantial percentage of the US trade deficit with other nations. For example, in 2007, petroleum imports were 47% of the United States trade deficit. At the higher crude oil prices that we saw this summer, the problem is even more acute. In July 2008, oil imports reached an astounding 84% of our trade deficit with other nations. The table below shows the monthly trends of US petroleum imports and the US trade deficit.



























Sources:
http://www.census.gov/foreign-trade/www/press.html : See Exhibits 1 and 17

Some Additional Reading Material......

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Initial Conclusions

The tables above underscore a few key points:

- The US is a major petroleum producing nation
- The US is by far the world's largest petroleum consumer
- The United States is heavily dependent on massive levels of imports from a number of nations, some of which are highly susceptible to production / supply disruptions
- Petroleum imports make up a sizable portion of our trade deficit.

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Bunta

I am an Engineer in the Defense Industry and the proud parent of a 1+ year old boy. I like spending time with my wife and child, reading, cooking, inv... more »

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