September 21, 2008

The More Things Change... Sarah Palin and Petroleum Export Bans

The McCain/Palin strategy on economic talking points appears to be one of turning molehills into mountains: focusing on rather small issues and blowing them up dramatically in the hope that most people will take the Republicans' word for it. However, as Economist's View pointed out the other day, issues like the amount of budgetary earmarks may sound like a lot of money, but they constitute less than one percent of the federal budget. Likewise, the idea that we can start offshore drilling for oil now and that it will help us in any way today is completely bogus. Americans are being sold a bill of goods by the Republicans, but many people don't care. P.T. Barnum knew the American attitude all too well. The more things change...

Now there's a new issue where Sarah Palin shows her "expertise," that of petroleum export bans:

Of course, it's a fungible commodity and they don't flag, you know, the molecules, where it's going and where it's not. But in the sense of the Congress today, they know that there are very, very hungry domestic markets that need that oil first. So, I believe that what Congress is going to do, also, is not to allow the export bans to such a degree that it's Americans who get stuck holding the bag without the energy source that is produced here, pumped here. It's got to flow into our domestic markets first.

Oh, dear! We Americans are exporting our own oil to other countries when we need it first. Surprisingly enough, that's true. Considering the ferocious appetite Americans have for petroleum, one would think that all domestically-produced petroleum would never be exported outside of the country, but it does. OK, so how much is exported?

If you look at the EIA's Energy Flow chart [pdf] above, you'll see that, in 2007, the US produced 10.80 quadrillion BTUs (QBTU) of its own crude oil, imported 28.70 QBTUs of petroleum and exported 2.93 QBTUs of petroleum. So, 2.93/39.50 = 7.4%. That's how much oil is being exported out of the country. Seven percent.

Let's get into the nitty-gritty even further. The seven percent above includes both crude oil and other petroleum products. However, if you look at the US imports and exports of crude oil and other petroleum products, you'll see that only 26,000 barrels per day were exported (as of this writing) compared with the 12,498,000 barrels per day that were both produced domestically and imported into the U.S. That's a grand total of 0.2% of the daily supply.

In principle, I don't have a problem with the U.S. setting up an export ban on domestically-produced petroleum, although there may be some very good reasons why that oil is being exported to begin with that are not being addressed by the Republicans. But what I do want to point out, yet again, is that this is a very small issue. Crude oil exports make up a tiny, tiny, tiny fraction of the total amount of crude oil that America uses on a daily basis. But Republicans would rather focus on the inconsequential than deal with the more serious economic matters at hand.

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