Suddenly the U.S. Is Exporting More Crude Than a Bunch of OPEC Members
Move over, Equatorial Guinea. Slide aside, Gabon. Make room, Ecuador. There's a new major oil exporter on the world stage, and it's the United States of America.
Most people know that the shale revolution has turned the U.S. into a big producer of oil, allowing it to become less reliant on imports. What's less known is how much oil it has been shipping abroad lately. U.S. exports in the first three months of 2017 exceeded those of five of the 14 members of the Organization of Petroleum Exporting Countries. The OPEC estimates come from Lloyd's Apex, which supplies its data to the U.S. Energy Information Administration.
Congress outlawed most exports in 1975 in reaction to the Arab oil embargo. As recently as 2013, U.S. crude exports, amounting to less than 50,000 barrels a day, were dwarfed by those of even the smallest OPEC members. But as domestic production increased, the U.S. ramped up sales to countries that were exempted from the ban by free-trade agreements. Some American oil was shipped to Canada to dilute the heavy oil coming from Alberta's tar sands.
Congress voted in December 2015 to lift the export ban. It took awhile for domestic producers to line up customers, but by early this year export volumes were soaring, as this chart shows.
So will the U.S. be joining OPEC? No chance. OPEC is an illegal price-setting cartel under U.S. antitrust law. Plus, U.S. interests don't align with those of OPEC, because even though the U.S. does export crude, it still imports about 10 times as much. But that hasn't stopped some other big oil exporters from trying to bring the U.S. into the fold. This year a former energy minister of Russia—which sometimes confers with OPEC on production—invited the U.S. to talk about coordinating production. And Nicolas Maduro, the flailing president of OPEC member Venezuela, said last year that the U.S. should attend OPEC meetings "because they are a big producer and they can’t be isolated from this and be lured by analysts, warmongers or anti-Russia sectors." Go figure.