US aims to become a major crude oil exporter in 2023

SARAJEVO, (Patria) -The United States has become a global exporter of crude oil in the last few years, but exports have not exceeded imports since World War II. That could change next year, Reuters reports.

Sales of US crude oil to other countries now stand at a record 3.4 million barrels per day, with exports of about 3 million barrels of refined products such as gasoline and diesel fuel. The United States is also a leading exporter of liquefied natural gas (LNG), whose growth is expected to surge in the coming years.

But the US consumes 20 million barrels of crude oil per day, the most in the world, and its production has never exceeded 13 million barrels per day. Last month, US government data showed that net US crude oil imports fell to 1.1 million barrels per day, the lowest level since records began in 2001. That is significantly less than five years ago, when the US imported more than 7 million barrels per day.

Sanctions and reserve management

Factors that have changed that equation include sanctions limiting oil and natural gas exports from Russia and the massive release of oil from US emergency reserves to combat rising fuel prices.

„Russia's invasion of Ukraine has spurred new demand for US energy and should push oil exports above the import rate by the end of next year, assuming shale production accelerates,“ said Rohit Rathod, a market analyst at energy research firm Vortexa.

To become a net exporter of crude oil, the United States must either increase production or reduce consumption. US oil demand is expected to rise 0.7 percent to 20.51 million barrels per day next year, meaning production would have to grow.

The United States already produces more oil than any other country in the world, excluding Saudi Arabia and Russia. US shale fields are being depleted, and production growth this year has been slow. Total production is expected to reach a record 12.34 million barrels per day next year - but only if prices are high enough to encourage companies to pump more.

Operators at export terminals are rushing to increase their capacity to better serve giant tankers that can carry more than 2 million barrels of oil. „Russia has proven to be an unreliable supplier,“ said Sean Strawbridge, CEO of the largest US oil export facility, the Port of Corpus Christi. „That really creates a wonderful opportunity for US producers and US energy.“

Corpus Christi could see an export increase of 100,000 barrels per day next year, Strawbridge said, following record shipments in the third quarter of 2.2 million barrels per day in the last quarter.

Analysts say net exports could decline if numerous countries around the world fall into recession, reducing demand, or if further easing of sanctions on Venezuelan crude oil increases that country's shipments.

LNG factor

The United States became the world's largest exporter of liquefied natural gas in the first half of 2022, surpassing Qatar and Australia, thanks to demand from Europe and rising prices. LNG exports will likely continue to grow into 2023, as Europe scrambles to replenish storage depleted this winter, said Matt Smith, an analyst at Kpler.

Exports of refinery products have declined due to plant closures and lower consumer demand. The US exported an average of 3.1 million barrels of fuel per day through September of this year, EIA data shows, down from 3.2 million barrels per day in the same period in 2019. An exception to this was diesel, whose exports rose to a three-year high in July of 1.3 million barrels per day, Kpler data showed. The upcoming European ban on Russian fuel has led to an average diesel delivery to Europe of 330,000 barrels per day in the first 15 days of December, more than five times the monthly average so far this year.