Consumer Energy Report is now Energy Trends Insider -- Read More »

By Robert Rapier on Oct 2, 2008 with no responses

Forbes Making Misleading Claims

Forbes magazine is making claims that the U.S. is exporting oil to other countries:

America’s Oil Export Problem (Yes, Export)

The U.S. could cut oil imports by nearly 15% tomorrow without using less gasoline, invading a foreign country or driving up prices at the pump. How? By cutting exports.

This will come as a surprise to many, but in the past four years U.S. oil and petroleum exports have reached four consecutive record highs–at least since the early ’80s. In 2007, the U.S. exported 1.43 million barrels of oil per day; up by roughly half a million barrels of oil per day since 2004.

As I said when Jon Tester made similar claims, that’s utter rubbish:

First off, here are the numbers from the EIA on exports from the U.S. of petroleum and petroleum products. What is the #1 destination for these exports? Mexico, one of our largest suppliers of crude oil. #2? Canada, our largest supplier of oil. And what are we sending them? Here, again, is the breakdown. The #1 product that we are supplying? Petroleum coke. #2? Residual fuel oil.

Misleading arguments simply give comfort to those who would argue that energy independence is within our grasp. After all, we are exporting all of this oil to other countries! But such arguments misrepresent the situation we are in.

The argument is correct on one point. Exports of high sulfur diesel did increase when the ultra-low-sulfur-diesel specs went into effect in the U.S. in 2006. However, in 2007 they were back down to the 2005 levels. Further, the total is still only a fraction of the ‘barrels’ of petroleum coke that are factored into the total ‘petroleum’ exports.

But the sound bite message that most people will come away with from articles like this is that we could go a long way toward energy independence if we just stop exporting oil. Just like we could be energy independent if those darn environmentalists would move out of the way and let us drill into our remaining oil reserves. The fact is, the problem of energy independence is so much greater than that. Drilling would be a drop in the bucket (albeit one that I favor). Exports are a drop in the bucket, and the countries that receive the exports – primarily Canada and Mexico – provide us far more petroleum in return.