Sunday, March 04, 2018

United States as energy exporter: Is it "fake news"?

Much of the media coverage of the American energy industry implies that America has become a vast and growing exporter of energy to the rest of the world and that this has created a sort of "energy dominance" for the country on the world stage.

Whether such reports qualify as so-called "fake news" depends very much on three things: 1) How one defines "fake news," 2) whether writers of such reports qualify the words "imports" and "exports" with the word "net" and 3) which energy sources they are discussing.

In this case let's define "fake news" as claims that official, publicly available statistics show plainly to be false. By that criterion anyone who claims that the United States is a net energy exporter would certainly be guilty of propagating "fake news."

Energy statistics from the U.S. Energy Information Administration (EIA) show that in November 2017 (the most recent month for which figures are available) the United States had net imports 329.5 trillion BTUs of energy in all its forms.* That's down from a peak of 2.74 quadrillion BTUs in August 2006, something that is certainly a turnabout from the previous trend. But all claims that the United States is a net energy exporter must be labeled as unequivocally false.

It turns out, however, that most people making misleading claims about America's energy situation don't actually say or write things which are technically false. What they do is use language which intentionally or unintentionally misleads the reader or listener.

For example, the claim that the United States is an exporter of crude oil is true. But that claim is entirely misleading. While the United States exports about 1.5 million barrels a day (mbpd) of crude oil, it also imports 7.5 mbpd. That puts the net imports of crude oil at about 6 mbpd. (All numbers are four-week averages as of February 23.) This reality is simply not conveyed by the unqualified statement that the United States is an oil exporter. Those making such a claim either haven't done their research, are sloppy writers or intend to mislead.

This curious state of affairs in American crude oil imports and exports results from not having enough refining capacity for the kind of oil coming out of the country's shale oil deposits, more properly called tight oil. That oil is too "light" for many American refineries that already have ample supply of light oil feedstocks (which are typically blended with heavier oil to achieve optimum refining results). Therefore, much of this light tight oil is shipped abroad to refineries with the capacity to refine it more profitably. The United States tends to import heavier crudes that match its overall refinery capabilities and needs (as explained in this discussion of crude oil swaps with Mexico starting in 2015 which resulted in swaps of light U.S. crude for heavy Mexican crude).

The United States has more refinery capacity than it needs for its own consumption of petroleum products such as gasoline, diesel, jet fuel and heating oil. Some of that capacity has long been used to produce these products for export—for over 30 years, in fact.

The EIA reports 4.5 mbpd of these products shipped abroad as the four-week average as of February 23. But that overstates the case since the number includes an enigmatic category called "Other Oil" which consists primarily of natural gas plant liquids (products such as ethane, propane and butane) that are simply not part of the petroleum production stream. Subtracting those gives us about 3 mbpd which are curiously offset by imports of those same products of about 1 mbpd. That puts the net exports of petroleum products strictly speaking at about 2 mbpd—significant, but not enough to make the United States a net exporter of crude oil and petroleum products combined. The country remains a net importer of about 4 mbpd of those combined products .

When it comes to natural gas, it turns out the United States is just barely a net exporter. In 2017 the country exported 3.17 trillion cubic feet (tcf) of gas and imported 3.04 tcf. America is hardly a major force in the natural gas export market today. There are those who claim, however, that it will become one because of future growth in U.S. natural gas production. This includes the EIA.

The EIA's record for long-term forecasts, however, is abysmal. (To see how abysmal, read here and here.) With regard to U.S. natural gas production, a private study based on actual natural gas well histories (rather than optimistic claims from the industry) suggests that production in 2050 will be only a fraction of what it is today. As the study points out, natural gas plays in shale basins are the only ones with growing production, and four of the six major shale gas plays are already in steep decline. It is difficult to see how such trends can lead to a major increase in U.S. natural gas production through 2050. (It is well to remember that oil and gas executives are on a constant hunt for capital with which to fund new drilling. Not surprisingly, it pays them to be optimistic when courting investors either in person or through the media.)

As for coal, the United States has long been self-sufficient in coal and currently exports about 3 percent of its production on a net basis according to EIA statistics.

There are connections between the U.S. and Canadian electricity grids. The Canadians send more electricity to the United States than the United States sends to Canada which, of course, makes the United States a net importer of Canadian electricity.

The United States does mine and process uranium for nuclear power stations. But almost 90 percent of the uranium purchased for American reactors must be imported.

The current picture of American energy production is decidedly not one of "dominance." Instead, though rising production of oil and natural gas has reduced dependence on foreign energy supplies, the country remains dependent on imported oil, a situation that even the ever optimistic EIA does not expect to change through 2050.

For those who say they know the future of energy production in the United States, I recommend reading the linked critiques above of previous major long-term energy forecasts. Making energy policy based on long-term forecasts that have proven again and again to be wildly mistaken is not just unwise, but dangerous. An infrastructure built for overly optimistic projections of supply for a particular fuel—natural gas fired electricity generating plants come to mind—could end up worthless or at the very least create tense and destabilizing competition for fuel supplies that don't grow as expected.


*It's worth noting that nobody was touting American "energy dominance" when the net energy import number last hovered around this value in the early 1980s.

Kurt Cobb is a freelance writer and communications consultant who writes frequently about energy and environment. His work has appeared in The Christian Science Monitor, Resilience, Common Dreams, Le Monde Diplomatique,, OilVoice, TalkMarkets,, Business Insider and many other places. He is the author of an oil-themed novel entitled Prelude and has a widely followed blog called Resource Insights. He is currently a fellow of the Arthur Morgan Institute for Community Solutions. He can be contacted at


Shawn B said...


Thanks for this excellent summary.

Any thought that this talk of energy independence is geopolitical propaganda from the “deep state” or whatever? Or just self-serving hype from the industry? How independent is the EIA?

Some days I think there is a veil that is purposely put before our eyes to mask the true state of things. Other days I just marvel at self-interested driven biases and think that everyone is just busy running to nowhere like the hamster on the flywheel.

Anonymous said...

That's OK to remove propane from the refined products but then you need to make a new category for NGLs (like you had for uranium, coal, electricity, etc.) And we are strong net exporters of NGLs.

Kurt Cobb said...

Shawn, my general rule is never to put down to guile what can be explained by incompetence. I think, in this case, we have a little of both. Those who seek to push an agenda that is helped by American "energy dominance" simply echo the headlines. That's the guile, not much of it, admittedly. The strange thing is that they and their staffs are so incompetent they don't seem to be able to do what I did--namely, look up on the EIA site what's actually going on. Now, the EIA is a fabulous place to get energy statistics. But its forecasts are driven by political considerations, namely, the Congressional committees who decide on their funding. The EIA can't be too far from the consensus if they expect to please their funders. Perhaps it's a survival mechanism for if the funding is cut to nothing, we'll have no statistics. BTW, the EIA says that it doesn't actually do forecasts. Go figure.

Kurt Cobb said...

To respond to anonymous, we need to be careful about terminology. NGLs are not the same as NGPLs. NGLs are a larger category that includes NGPLs plus lease condensate. Lease condensate is, in fact, part of the petroleum production stream and so is reflected in the numbers I cite for oil. Because imports of NGPLs are negligible, exports are about the number you could infer from my piece, around 1.5 mbpd. It's important to note that NGPLs are often used as petrochemical feedstocks (ethane, for example). When they are used as sources of energy (butane and propane, for example), they represent about 60 percent of the energy density of oil by volume. Those who lump in NGPLs with oil often gloss over this fact. NGPLs are direct substitutes for oil only on a very limited basis.

Anonymous said...

I'm agreeing with you that C2-C4 aren't like gasoline or jet or diesel or crude oil. Just if you separate it out, you need a new category for the essay, whatever you call it.

Coal: slight net exports
Natural gas: slight net exports
Electricity: slight net imports
Uranium: strong net imports
Crude: still strong imports but down lately
Crude products (excluding C2-C4): strong exports
C2-C4: strong exports

All I'm saying is the minor point that if you cut them out of the crude products category, you need a new category to contain them. And in that category, we are strong net exporters.

Anonymous said...

The EIA has been granted immunity from government interference in doing their jobs, similar to the Supreme Court in some respects..any reason to presume that they spend their time responding to their masters when in reality they have none?

Kurt Cobb said...

The EIA is by no means immune from government interference. Though other agencies are forbidden from influencing or editing the reports and figures the agency publishes, like any federal agency it must answer to Congressional appropriators who control its budget. Moreover, the head of the agency is nominated by the president and confirmed by the Senate. Since the EIA administrator is a political appointee, he or she serves at the pleasure of the president and can be dismissed at any time.