U.S. on track to be a net exporter of gasoline for the first time in 60 years

Party Rooster

Unleash The Beast
Apr 27, 2005
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#1
Was wondering why gas has still been going down despite oil going up over $100 a barrel.

Gasoline: The new big U.S. export
By Steve Hargreaves @CNNMoney December 5, 2011: 12:41 PM ET

The U.S. still imports more than half its oil. But thanks to declining demand for products made from crude, the country is now supplying the rest of the world with gasoline.

NEW YORK (CNNMoney) -- The United States is awash in gasoline. So much so, in fact, that the country is exporting a record amount of it.

The country exported 430,000 more barrels of gasoline a day than it imported in September, according to the U.S. Energy Information Administration. (Read: OPEC: We want clean energy.)

That is about twice the amount at the start of the year, and experts and industry insiders say the trend is here to stay.

The United States began exporting gas in late 2008. For decades prior, starting in 1960, the country used all the gas it produced here plus had to import gas from places Europe.

But demand for gas has dropped nearly 10% in recent years. It went from a peak of 9.6 million barrels a day in 2007 to 8.8 million barrels today, according to the EIA.

The drop was caused partially by the recession but also by the advent of more fuel efficient vehicles, higher prices and the greater use of ethanol as an ingredient in gasoline. Demand for other products made from crude oil like diesel and jet fuel has also declined, although not as much.

Oil's up, gas is down. Why?

To be sure, the United States is still importing plenty of oil to make that gasoline -- and is still dependent on foreign countries for well over half the crude it uses.

But now the country's massive refining infrastructure is producing more gasoline, diesel and jet fuel than the United States needs, freeing it up to be exported to places like Brazil, Mexico and Chile where demand is still strong.

The Wall Street Journal, which reported on the export trend last week, said the United States is on track this year to be a net exporter of refined products for the first time in 62 years.

"We've got plenty of excess refining capacity," said Jonathan Cogan, a spokesman for EIA. "It's a reminder that this is a global oil market, and it's reflected by the movements of products to where they will get the highest prices."

Oil roars back to $100, but does anybody care?

Mark Williams, global head of refining, trading and marketing for Royal Dutch Shell (RDSA), said exporting diesel and other refined products from the United States used to happen fairly irregularly but is now becoming much more common.

"It's growing as a new business," he said, although he cautioned that the United States would probably not become a huge exporter of fuel.

Still, the ability to export oil is good news for Shell and other oil companies like Exxon Mobil (XOM, Fortune 500), BP (BP) and Chevron (CVX, Fortune 500). They can use their extensive and modern refineries in the United States to make gasoline for the rest of the world.

But it may be bewildering for American drivers, who could experience record high gas prices next year even though U.S. demand could hit the lowest level in a decade, said Tom Kloza, chief oil analyst at the Oil Price Information Service.
 

mascan42

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Aug 26, 2002
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#2
Maybe it's me, but I thought most countries did their own refining. Are we just exporting to the third-world?
 
Jun 2, 2005
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Dallas
#3
Maybe it's me, but I thought most countries did their own refining. Are we just exporting to the third-world?
Yes but no. We're exporting largely to third-world nations, but a lot of more modern societies still rely heavily on imports for largely political reasons.

All in all this is very good economic news for us.
 

Hate & Discontent

Yo, homie. Is that my briefcase?
Aug 22, 2005
15,777
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#4
Yes but no. We're exporting largely to third-world nations, but a lot of more modern societies still rely heavily on imports for largely political reasons.

All in all this is very good economic news for us.
Yep. Now if only we had started more drilling about 10 years ago...
 

ShooterMcGavin

Go back to your shanties.
May 25, 2005
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#5
Can I get the link to the article please?
 

CousinDave

Registered User
Dec 11, 2007
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Ohio
#6
Maybe it's me, but I thought most countries did their own refining. Are we just exporting to the third-world?

Their demand for gasoline is going up faster than their levels of refining, while in the US demand isn't really increasing - cars are getting more efficient, people are driving less, etc...
 

MrAbovePar

En Taro Anthony
Mar 14, 2005
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Covington. La
#7
Their demand for gasoline is going up faster than their levels of refining, while in the US demand isn't really increasing - cars are getting more efficient, people are driving less, etc...

Bingo.

However our politicians will fuck it up by pressuring refineries to restrict exports in an attempt to glut the local market and drive prices down. Resulting in foreigners sending us less oil and refining it themselves.

You can always expect a political solution that ruins a good thing.
 

MayrMeninoCrash

Liberal Psycopath
Dec 9, 2004
24,438
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Silverdale, WA
#9
Additionally, our refineries are the only ones that can handle certain crudes, like the high-sulfur stuff from Venezuela. They need us to refine their shit otherwise it's just duck coating.