WASHINGTON (Reuters) - Amid a flurry of Twitter posts on Monday morning, U.S. President Donald Trump turned to the weekend attack on Saudi Arabia’s oil facilities and assured his audience the United States had become such a big producer it no longer needed oil from the Middle East. (See tweet here)
U.S. government data tells a different story: The technology-driven U.S. drilling boom that started more than a decade ago has made the United States a massive producer, but imports of crude oil and petroleum products from the Gulf region last year still flowed in abundantly. (Read story here)
“By and large, we are still importing quite a bit and not totally immune to the world market,” Jean-François Seznec, a senior fellow with the Atlantic Council Global Energy Center, said during a call with reporters on Monday.
Iran has rejected U.S. charges it was to blame for the attacks, which damaged the world’s biggest crude-processing plant in Saudi Arabia and triggered the largest jump in crude prices in decades.
Saudi Arabia is the world’s biggest oil exporter, shipping about 7 million barrels of crude daily around the globe. The United States, produces roughly 12 million barrels per day, but consumes 20 million bpd, meaning it must import the rest.
Much of the U.S. shortfall comes from Canada, but some still comes from Saudi Arabia, Iraq and other Gulf nations because several U.S. refineries prefer their oil. As an example, the biggest U.S. refinery – Motiva Enterprises LLC in Port Arthur, Texas – is half-owned by Saudi Arabia’s state energy company, Saudi Aramco, and is set up for Saudi grades.
Other refineries – particularly in California - are isolated from big U.S. oil fields and must also rely on cargoes. (Read story here)
The mismatch between what U.S. refiners want and what the United States produces means that in 2018, the United States imported an average of 48 million barrels per month of crude oil and petroleum products from the Gulf region, according to the U.S. Energy Information Administration.
That is down about a third from a decade ago, as domestic oil and gas production soared, but roughly the same level as in 1995 and 1996, according to the data.
Phillip Cornell, another senior fellow with the Atlantic Council, who used to advise Saudi Aramco, called Trump’s tweet “nonsense.”
“He’s a guy who likes hyperbole,” he said.
Sarah Emerson, president of ESAI Energy LLC, said the Saudi production outage, if it is prolonged, could provide an opportunity for U.S. crude oil producers to expand their overseas markets.
Reporting by Timothy Gardner; Additional reporting by Valerie Volcovici; Writing by Richard Valdmanis; Editing by Peter Cooney