Update: How Much Oil Does America Import?

Currently, my most popular blog post by far is How Much Oil Does America Import?, written back in May 2006, two years ago. I thought it was time to update the figures and see how the U.S. is doing since I first wrote that post.

The U.S. gets its oil from two sources: either it pumps its own oil, called "Field Production" by the Department of Energy, or it imports oil from other countries around the world. In 2000, American commercial field production made up 38.69% of the total supply of crude oil, while imports made up 60.28%. In 2005, when I wrote the last post, those same percentages were 33.67% and 65.84%, respectively. (These numbers are different from what I wrote back in 2006 as adjustments have been made to the official statistics; these types of revisions are normal for economic statistics.) In 2007 (the most recent year), the percentages were 33.72% and 66.19%, respectively. While there has been an extremely slight increase in the amount of oil pumped domestically (0.05%), imports have also increased as well. (The reason why both numbers can increase is because a third number, "supply adjustments," fell.)

In 2007, the U.S. imported a total of 3,656,170 thousand barrels. Of those 3.66 billion barrles, the U.S. imported from a total of 46 different countries. The top 5 importing countries were: Canada (18.61%), Saudi Arabia (14.50%), Mexico (14.07%), Venezuela (11.48%), and Nigeria (10.80%), for a total of 69.47% of all American imports. In contrast, imports from countries six through ten (Angola, Iraq, Algeria, Ecuador, and Kuwait) made up only 17.95% of the total; countries 11 through 46 made up the remaining 12.58%.

Looking at petroleum imports in two other ways...

In 2007, imports from OPEC countries* made up 53.85% of all U.S. imports, compared to the 46.15% from non-OPEC countries. However, this is the exception rather than the rule. Since 1993, when the Energy Information Agency (EIA) started breaking out the statistics, non-OPEC countries have been the dominant exporters ten years out of the past fifteen. The year 2007 was the first time since 2001 that OPEC countries had sold more petroleum to the U.S. than non-OPEC countries.

With respect to the Persian Gulf, those countries** only made up 21.19% of the total imports. This is down slightly, one-half percent, from my 2006 analysis. Note that the U.S. imports no oil from Iran.

Conclusions/Predictions:
Two years ago, I made four points as to how I thought things would go with respect to American oil imports and consumption. We'll look at how good or bad those predictions were:

1. American field production will probably go below 25% of its total annual supply within the next five years.

I think we can write this prediction off; I don't foresee this happening within the next three years (or perhaps even the next ten).

2. In that same time frame, imports will probably be in the high 50s percentage (perhaps 58-59%).

On the other hand, I think this prediction is very much a lock at this time. In fact, I wouldn't be surprised if this number goes back up again, remaining in the 60-65% range.

3. America will continue to seek the majority of its oil from non-OPEC countries, such as Canada and Mexico, if only to avoid being as dependent on OPEC countries as they have been in the past. However, this will probably turn out to be a pipe dream in the long run unless Canadian oil reserve estimates turn out to be near the high end. (Estimates for Canada's proven oil reserves ranges from 4.7 billion barrels (World Oil) to 14.803 billion barrels (BP Statistical Review) to 178.792 billion barrels (Oil & Gas Journal). Obviously, this extremely wide range of guesses shows that no one truly knows how much oil Canada has.)

Since I wrote this, I've gotten a better understanding with respect to Canada's oil reserves. The problem with the Canadian oil sands is that it is made up of a very dense and viscous type of petroleum called bitumen. Bitumen is like molasses at room temperature, and needs heating just to flow. (The tar that we pave roads with is bitumen.) Oil refineries are set up to process certain types of crude oils, and bitumen is normally not one of them. So, while Canada has a lot of proved oil reserves, most of it is not in the form the refineries need to produce products like gasoline. In this respect, the lower reserve amount mentioned above is probably closer to the amount of crude oil Canada actually has. In time, more refineries may convert to take advantage of the Canadian oil sands, but that will probably be a gradual process.

4. Persian Gulf oil, which has ranged between 19.81% and 28.56% of all U.S. imports since 1996, will probably continue to hover in the high teens-low 20s, despite President Bush's goal to cut American consumption of Middle Eastern oil by 75% by 2025, per the latest State of the Union address.

I don't see this forecast changing at all. What President Bush said in 2006 about cutting the amount of Middle Eastern oil America consumes was complete and utter bullshit (and shame on you if you believed him). BTW, shame on you again if you believe either McCain or Cheney that drilling for oil offshore or up in Alaska will make a significant difference. Two reasons: "drop in the bucket" and "long-term projects," neither of which will lower your gas prices. I may post on this in the near future, insha'allah, but in the meantime I recommend that you read John McCain's Oil Scam over at Informed Comment (Juan Cole), and Drilling Our Way to... by Menzie Chinn over at Econbrowser.


References:
US Crude Oil Supply and Disposition (DoE)
US Crude Oil Imports by Country of Origin (DoE)

Notes:
* OPEC countries include Algeria, Angola, Ecuador, Indonesia, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the UAE, and Venezuela.
** Persian Gulf countries include Bahrain, Iran, Iraq, Kuwait, Qatar, Saudi Arabia, and the United Arab Emirates. However, Iran and Qatar export no oil to the U.S.

How Much Oil Does America Import?

Ever since I wrote Oil: America's Smack back in February, I've had a fairly steady stream of visitors asking the same question: how much oil does America import? I touched on this answer in my Smack post, but the question is worth looking into once more.

Every year, the United States pumps up some of its own oil (called "Field Production" according to the DoE) and imports the rest. Not surprisingly, American field production has been dropping over time. In the year 2000, American commercial field production made up 33.51% of its total supply of crude oil, while imports made up 52.21%. In 2005, those same percentages were 28.44% and 55.85%, respectively. And, of course, there's no reason to expect either of these trends not to continue going down and up, respectively, in the near future.

The United States has been importing oil since at least 1910 (according to DoE statistics), when a mere 557 thousand barrels of oil were brought into the country. Last year, the U.S. imported 3,670,403 thousand barrels of oil. Of those 3.67 billion barrels of oil, the U.S. imported from a total of 42 different countries. The top 5 importing countries were Canada (16.34%), Mexico (15.42%), Saudi Arabia (14.30%), Venezuela (12.24%), and Nigeria (10.54%), for a total of 68.84% of all American imports. In contrast, imports from countries 6 through 10 (Iraq, Angola, Ecuador, Algeria and the United Kingdom) make up only 16.84% of the total, with countries 11 through 42 making up the remaining 14.33%.

Looked at another way, only 21.69% of America's oil imports come from the Persian Gulf region. Per the DoE, the Persian Gulf includes Bahrain, Iran, Iraq, Kuwait, Qatar, Saudi Arabia, and the United Arab Emirates; however, Iran and Qatar export no oil to the United States. If we compare imports from OPEC countries vs. non-OPEC countries, we find that non-OPEC countries are now in the majority, 52.64% vs. 47.36%. And, with the exception of one year, 2001, non-OPEC countries have been in the ascendancy since 1994.

Conclusions/Predictions:
1. American field production will probably go below 25% of its total annual supply within the next five years.
2. In that same time frame, imports will probably be in the high 50s percentage (perhaps 58-59%).
3. America will continue to seek the majority of its oil from non-OPEC countries, such as Canada and Mexico, if only to avoid being as dependent on OPEC countries as they have been in the past. However, this will probably turn out to be a pipe dream in the long run unless Canadian oil reserve estimates turn out to be near the high end. (Estimates for Canada's proven oil reserves ranges from 4.7 billion barrels (World Oil) to 14.803 billion barrels (BP Statistical Review) to 178.792 billion barrels (Oil & Gas Journal). Obviously, this extremely wide range of guesses shows that no one truly knows how much oil Canada has.)
4. Persian Gulf oil, which has ranged between 19.81% and 28.56% of all U.S. imports since 1996, will probably continue to hover in the high teens-low 20s, despite President Bush's goal to cut American consumption of Middle Eastern oil by 75% by 2025, per the latest State of the Union address.

References:
US Crude Oil Supply and Disposition (DoE)
US Crude Oil Imports by Country of Origin (DoE)
World Proved Reserves of Oil and Natural Gas, Most Recent Estimates

Update: I've written an updated post to this; please see Update: How Much Oil Does America Import.

Note: Despite the age of this article, it remains extremely popular, currently getting over 20% of all my hits on a daily basis. Since I wrote this post, I've written a number of other articles on oil. You might want to check out the following (so far to date; the most recent are at the top):

Update: How Much Oil Does America Import?

Crude Oil Prices, Dollars vs. Euros: Is There a Difference?

Petroleum and Natural Gas Proven Reserves, 2008, Top 10

U.S. Primary Energy Consumption by Source and Sector, 2006

Antonio Rappa on Oil

American Theocracy

Juan Cole on Global Warming, Oil and American Politics/Militarism

World Oil Reserves

Oil: America's Smack

And over at one of my other blogs:

Southeast Asian Petroleum Consumption Forecasts, 2007-2012

I hope to have a number of other posts like the one above at the new blog, J2TM, in the near future.

Oil: America's Smack

Another pop quiz, hotshot! Name the number one oil importer to the United States.

Saudi Arabia? Guess again. It's Canada. In fact, Saudi Arabia comes in third, after Mexico. Yes, you may have thought that the Middle East provided the United States with most of its oil, but that's not true either. In 2004, Persian Gulf countries (defined by the US Department of Energy as consisting of Bahrain, Iran, Iraq, Kuwait, Qatar, Saudi Arabia, and the United Arab Emirates) only provided 2,400 thousand barrels of oil per day (tbpd) or 23.80% of the 10,084 tbpd total imported. If you expand the list to include other Middle Eastern countries not located in the Persian Gulf (e.g., Algeria, Libya, Syria, etc.), the total goes up to a mere 2,648 tbpd or 26.26% of the total. Finally, if you expand the list to include all Muslim-majority countries around the world (e.g., Brunei, Indonesia, Malaysia, etc.), the quantity is 3,793 tbpd or 37.61% of the total. In other words, only a little over 1/3 of America's oil imports come from Muslim countries.

“America is addicted to oil, which is often imported from unstable parts of the world,” Mr Bush said in his State of the Union address. “By applying the talent and technology of America, this country can dramatically improve our environment, move beyond a petroleum-based economy and make our dependence on Middle Eastern oil a thing of the past.” (Source: Financial Times)

I agree that America is addicted to oil. There's no question about that. And I have no problem with the Bush administration trying to move beyond a petroleum-based economy through "talent and technology." There's nothing wrong with that either.

But saying that the Bush administration's goal is to cut American consumption of Middle Eastern oil by 75% by 2025 is merely a smokescreen for the ignorant. There's nothing wrong with the goal per se, but the goal won't make any real dent in America's oil addiction. If the Bush administration really wanted to cut out 75% of Middle Eastern oil, they could do so now by stopping the importation of Saudi Arabian and Iraqi oil. Those two countries, in 2004, accounted for 2,150 tbpd out of the Middle East's total of 2,648 tbpd, or 85.08% of the Middle East's total. Boom! You've not only gone past the 75% mark, but cut an additional 10% beyond that.

But like any junkie, America will move from one supplier to another. Instead of Saudi Arabia and Iraq, the US will probably move on to one of the other big producers (if they can): Canada (1,616 tbpd or 16.03%), Mexico (1,598 tbpd or 15.85%) or Nigeria (1,078 tbpd or 10.69%). (Venezuela is the only other large importer, sending 1,297 tbpd or 12.86%, but - obviously - recent relations with that country's government would nix that idea.)

A better suggestion by the President would have been to cut overall oil imports into the country by, say, 25%. Instead of importing 10,084 tbpd, how about dropping the number by 2,521 tbpd to 7,563 tbpd? That would not only be equivalent to stopping all imports from the Middle East, but would also provide real incentives to car and oil companies to find a meaningful solution to America's oil addiction.

- - - - - - - - - - -

In the meantime, the President's speech ignores reality. As he said, oil is "often imported from unstable parts of the world." And, of course, we're supposed to infer that the "unstable parts" include the Middle East and Venezuela. But even if the US imported oil from "stable parts of the world," that oil in the "unstable parts" will still be sought out by other countries. All of the world is "addicted" to oil, not just the United States. If the US stopped importing Saudi Arabian and Iraqi oil, as I suggested above, other countries (e.g., China, the European Union, Japan, etc.) would gladly pick up the slack. The oil is not going to go away. Moreover, as Frank Verrastro, director and senior fellow in the Center for Strategic and International Studies energy program said, “Even if America doesn’t import a drop of Middle Eastern oil, these countries will still play an increasingly important role in determining how much we pay for oil. You pay the global price and it doesn’t matter where you buy it from.”

- - - - - - - - - - -

Other reactions to Bush's speech included:

Myron Ebell, director at the Competitive Enterprise Institute, a conservative think-tank: “The president’s hackneyed and dangerous energy rhetoric that we are addicted to oil is an indication that the administration is addicted to confused thinking about energy policies. [His goals] will be hindrances to creating a bright energy future for American consumers.”

Jim Footner of Greenpeace: “We’ll wait and see what concrete action [Mr Bush] takes before getting our hopes up. After all, there is a treaty to reduce America’s dependence on oil – it’s called Kyoto, and Bush walked away from it.”

Bill Prindle, the deputy director of the American Council for an Energy-Efficient Economy: "The administration has made much of its investment in energy efficient technology. However, much of this has been a reallocation of research funds. The budget requests from the White House for funding on energy efficiency has actually fallen 14 per cent in real terms since 2002."