Cartoon Of the Month
The United States is the largest consumer of crude oil and condensate in the world by a significant margin. In 2020 the EIA reports the US burned 122,000,000 gallons of diesel each and EVERY day of that year.
Over the past five years the US government has sanctioned oil exports from Venezuela, Iran, Libya, Syria and, with the shutting down of the Keystone Pipeline in 2021, effectively... Canada.
Its now also has sanctioned Russian imports of heavy, sour crude oil, exactly the type of oil American refineries need, desperately, to make what America needs most... diesel.
The 2nd largest crude exporter in the world, the Kingdom of Saudi Arabia, just made a deal with China to import KSA oil and get paid in yuan's, not petrodollars, if true a remarkable turn of events in world oil markets. India just joined the partnership.
63% of America's oil production is now 46 degree API, and above, because of the HZ tight oil phenomena. That oil is getting lighter every year. Our countries refineries were built to process 32-35 API, sour oil and accordingly, we can only absorb 4.8 MM BOPD of light tight oil from our nations shale basins. The rest HAS to be exported; there is no more to be done with it in our country.
The battle cry for more US shale oil under the auspices of "energy independence" and to reduce our need for oil imports is a blatant lie. Because more tight oil has to be exported, it does not benefit the American consumer in any meaningful way. As to the argument US exports have effectively been used as a foreign policy tool and helped neutralize Russia and Chinese regional power, is crap, see above.
The DJ, Eagle Ford and Williston tight oil basins are on their last legs and barely able to now maintain current production levels, already down significantly the past four years. America's entire hope for long term energy security lies in the Wolfcamp formation in six or seven counties of the Permian Basin.
In both sub-basins of the Permian Basin, 39,000 HZ wells have already been drilled, mostly 330 feet apart, to every known productive bench there is. Well productivity and EUR's are beginning to wane; in many core areas, significantly. GOR's and WOR's are both going up, up and up, all a precursor to depletion and much higher operating costs. It happens in the oilfield; nothing lasts forever and neither will the Permian HZ tight oil play, see above.
Nevertheless, in February of 2022... 81% of total Permian Basin tight oil production was sent directly to the Texas Gulf Coast, put on ships and exported to foreign countries.
None of this makes any sense whatsoever. NONE of it! Nobody of any authority in our great nation can think past next week. They'll do, or say anything for another dollar, or another vote.
The policy of draining America first, for the sake of exports, is putting America's long term energy security, or our children's future...last.