The US Just Became a Net Oil Exporter for the First Time in 75 Years.
America has turned into a net oil exporter, breaking almost 75 years of continued dependence on foreign oil and marking a pivotal moment toward what US President Donald Trump has branded as "energy independence".
The shift to net exports is the dramatic result of an unprecedented boom in American oil production, with thousands of wells pumping from the Permian region of Texas and New Mexico to the Bakken in North Dakota to the Marcellus in Pennsylvania.
While the country has been heading in that direction for years, the dramatic shift came as data showed a sharp drop in imports and a jump in exports to a record high.
“We are becoming the dominant energy power in the world,” Michael Lynch, president of Strategic Energy & Economic Research, told Bloomberg. “But, because the change is gradual over time, I don’t think it’s going to cause a huge revolution.”
The shale revolution has transformed wildcatters into billionaires and the US into the world’s largest petroleum producer, surpassing Russia and Saudi Arabia. The power of OPEC has been diminished, undercutting one of the major geopolitical forces of the last half century.
"The week started with Qatar leaving OPEC; then a mysterious US-Saudi bilateral meeting in Vienna; followed by a canceled OPEC press conference, and now the latest news that the US turned last week into a net petroleum exporter," said Helima Croft, commodities strategist at RBC Capital Markets LLC and a former analyst at the Central Intelligence Agency.
According to the US Energy Information Administration, the US has been a net oil importer in weekly data going back to 1991 and monthly data starting in 1973. Oil historians that have compiled even older annual data using statistics from the American Petroleum Institute said the country has been a net oil importer since the mid-1940s, when Harry Truman was in the White House.
On paper, the shift to net oil exports means that the US is today energy independent, achieving a rhetorical aspiration for generations of American politicians, from Jimmy Carter to George W. Bush. Yet, in reality, the US remains exposed to global energy prices, still affected by the old geopolitics of the Middle East.
While the net balance shows the US is selling more petroleum than buying, American refiners continue to buy millions of barrels each day of overseas crude and fuel. The US imports more than 7 million barrels a day of crude from all over the globe to help feed its refineries, making the US the world’s top fuel supplier.