This Associated Press article that appeared in the Lancaster Intelligencer Journal/New Era on Saturday, December 31 sparked our interest.
What … the biggest commodity that we, the United States, exported this year is … what, fuel?
As consumers watched gasoline and heating oil prices head ever skyward, we’re selling fuel to other nations. Even for a market-driven capitalistic nation, we wonder, “Huh?” The AP article follows; note that Columbia news, views & reviews has added bold-face and underscoring in some cases.
“NEW YORK — For the first time, the top export of the United States, the world’s biggest gas guzzler, is — wait for it — fuel.
“Measured in dollars, the nation this year is expected to ship more gasoline, diesel, and jet fuel than any other single export, according to U.S. Census data going back to 1990. It also will be the first year in more than 60 that America has been a net exporter of these fuels.
“Just how big of a shift is this? A decade ago, fuel wasn’t even among the top 25 exports. And for the last five years, America’s top export was aircraft.
“The trend is significant because for decades the U.S. has relied on huge imports of fuel from Europe in order to meet demand. It only reinforced the image of America as an energy hog.
“And up until a few years ago, whenever gasoline prices climbed, there were complaints in Congress that U.S. refiners were not growing quickly enough to satisfy domestic demand; that controversy would appear to be over.
“Still, the U.S. is nowhere close to energy independence. America still is the world’s largest importer of crude oil. From January to October, the country imported 2.7 billion barrels of oil worth roughly $280 billion.
“Fuel exports, worth an estimated $88 billion in 2011, have surged for two reasons:
- Crude oil, the raw material from which gasoline and other refined products are made, is a lot more expensive. Oil prices averaged $95 a barrel in 2011, while gasoline averaged $3.52 a gallon — a record. A decade ago oil averaged $26 a barrel, while gasoline averaged $1.44 a gallon.
- The volume of fuel exports is rising. The U.S. is using less fuel because of a weak economy and more efficient cars and trucks. That allows refiners to sell more fuel to rapidly growing economies in Latin America, for example. In 2011, U.S. refiners exported 117 million gallons per day of gasoline, diesel, jet fuel and other petroleum products, up from 40 million gallons per day a decade earlier.
“There’s at least one domestic downside to America’s growing role as a fuel exporter. Experts say the trend helps explain why U.S. motorists are paying more for gasoline. The more fuel that’s sent overseas, the less of a supply cushion there is at home.
“Gasoline supplies are being exported to the highest bidder, said Tom Kloza, chief oil analyst at Oil Price Information Service. “It’s a world market.”
“Refining companies won’t say how much they make by selling overseas. But analysts say those sales likely generate higher profits per gallon than the fuel sold in the U.S. Otherwise, they wouldn’t occur.
“The last time the U.S. was a net exporter of fuels was 1949, when Harry Truman was president. That year, the U.S. exported 86 million barrels and imported 82 million barrels. In the first ten months of 2011, the nation exported 848 million barrels (worth $73.4 billion) and imported 750 million barrels.”