Earlier this week, Bloomberg reported the US has become a net oil exporter for the first time in 75 years. This status serves as both a practical and symbolic milestone, indicating the US’ dominant role in the global energy market. The article highlights the factors leading up to this newfound “energy independence,” writing:
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.
On paper, the shift to net oil exports means that the U.S. is today energy independent, achieving a rhetorical aspiration for generations of American politicians, from Jimmy Carter to George W. Bush. Yet, it’s a paper tiger achievement: In reality, the U.S. remains exposed to global energy prices, still affected by the old geopolitics of the Middle East.
Although the US is exporting record amounts of oil to our allies around the globe, there is still much work to be done when it comes to growing our energy infrastructure and achieving more efficient transportation methods. As reported by E&E News, the oil industry has flared a record amount of natural gas in Texas’ Permian Basin this year, and is expected to flare even more gas in 2019. Flaring is the process of burning excess gas at drilling sites that could not be transported for consumer use due to a lack of infrastructure in the region. In addition to being a potential environmental concern, flaring disposes of valuable gas that could be utilized by consumers around the country, such as those in New England who are preparing for another frigid winter.
Fortunately, there are a number of projects underway in the Permian to help alleviate the pipeline bottleneck, and will better position the US to maximize oil production, export capabilities, and efficient transport of product. Bloomberg writes:
U.S. crude exports are poised to rise even further, with new pipelines from the Permian in the works and at least nine terminals planned that will be capable of loading supertankers. The only facility currently able to load the largest ships, the Louisiana Offshore Oil Port, is on pace to load more oil in December than it has in any other month.
GAIN recognizes the US’ status as a net exporter of oil as an important milestone in our history and moving forward. A strong American energy industry not only plays a critical role in fueling our growing economy, but also stabilizes the global market with the US as a key player.