The U.S. Just Became a Net Oil Exporter for the First Time in 75 Years

Do you think that having the United States dictate whether Iran can sell their oil is a free market?

And it is not a boon if the price is to low!

Damn... Originally Posted by WTF

It's called leverage, and it's another advantage of being a net oil exporter. Oil is Russia and Iran's primary source of revenue. Keeping prices low hurts them more than the U.S.

BTW, Trump was president when that happened. Originally Posted by I B Hankering

Well maybe history will not blame him....

https://www.zdnet.com/article/why-th...ot-export-oil/

The weekly data showing net exports of 200,000 barrels per day was a fluke. I suspect it was caused by changes in inventories. USA crude oil inventories were the highest they've been in 2018 a couple of weeks ago. You're likely going to see net imports go back to about 2 million barrels per day soon.

In the medium term, in a year or two, the USA may indeed become a net exporter. A lot of it will depend on oil prices. WTF brings up an interesting point,

Which is it IB....are you cheering for low oil prices that would hurt oil production in this country like you were for the last two weeks or are you now cheering for high oil prices that hurt the average consumer? Originally Posted by WTF

If the price of oil goes to, say, $40 per barrel as a result of OPEC continuing to keep the floodgates open, this will indeed mean the USA won't become a net exporter. The unconventional oil plays in the USA mostly aren't economic at that price.

If the price goes to $70/barrel and stays there, then we will become a significant net exporter.

What's best? IB and Trump would argue $40 per barrel, as that's good for the economy and the consumer. Others would argue $70 per barrel is worth paying if it means we can have energy security. If we're an exporter, the Saudis or Iran or Venezuela can't hold us over a barrel. Remember the Arab oil embargo of 1973 and the 1973 recession. I don't know which argument is better, both sides have good points.

Tiny, my problem is with people trying to give Trump credit for both sides of the equation!

There is a ying n yang to everything. Be nice if some realized the sun don't rise and set according to Donald J Trump

Tiny, my problem is with people trying to give Trump credit for both sides of the equation!

There is a ying n yang to everything. Be nice if some realized the sun don't rise and set according to Donald J Trump Originally Posted by WTF

The witticism "every cloud has a silver lining" comes to mind, and as Tiny conceded, an argument for either event has winning points.

both sides have good points. Originally Posted by Tiny

The weekly data showing net exports of 200,000 barrels per day was a fluke. I suspect it was caused by changes in inventories. USA crude oil inventories were the highest they've been in 2018 a couple of weeks ago. You're likely going to see net imports go back to about 2 million barrels per day soon.

In the medium term, in a year or two, the USA may indeed become a net exporter. A lot of it will depend on oil prices. WTF brings up an interesting point,



If the price of oil goes to, say, $40 per barrel as a result of OPEC continuing to keep the floodgates open, this will indeed mean the USA won't become a net exporter. The unconventional oil plays in the USA mostly aren't economic at that price.

If the price goes to $70/barrel and stays there, then we will become a significant net exporter.

What's best? IB and Trump would argue $40 per barrel, as that's good for the economy and the consumer. Others would argue $70 per barrel is worth paying if it means we can have energy security. If we're an exporter, the Saudis or Iran or Venezuela can't hold us over a barrel. Remember the Arab oil embargo of 1973 and the 1973 recession. I don't know which argument is better, both sides have good points. Originally Posted by Tiny

Saudi Arabia's new fields especially offshore require %70 per barrel oil to breakeven.

Russia also needs a price above at least $50 per barrel. Russia's big issue is the thousands of miles that oil has to travel even get to ships just to go to China.

Price of oil also depends on how easy certain crudes are to refine into products. Most of the oil from tight shale crude has to be blended with heavier crude oils to make it refinery worthy. "Crude oil" such as that from Eagle Ford is actually condensate and a refinery will lose up to 30% capacity due the very light nature of it. Such a loss of capacity would bankrupt most refineries.

That being said, oil companies do invest in R&D for new technology and materials used elsewhere way the hell more effectively than Silicon Valley. Low oil prices mean that research PhD's lose their jobs. For instance single wall carbon nanotubes in compounded materials in deepwater high temp high pressure components at the wellhead were used there before being used by NASA or military.

The witticism "every cloud has a silver lining" comes to mind, and as Tiny conceded, an argument for either event has winning points. Originally Posted by I B Hankering

Yes but you have been arguing how great LOW OIL PRICES are.

Now you are bragging about our oil exports.

Those two things do not play well together.

Trump wants the Saudis to keep pumping to drive the price even lower. Or at least that is what the silly sob is trying to convince his followers.

Which is probably what he really wants as he is no friend of big oil.

Saudi Arabia's new fields especially offshore require %70 per barrel oil to breakeven.

Russia also needs a price above at least $50 per barrel. Russia's big issue is the thousands of miles that oil has to travel even get to ships just to go to China.

Price of oil also depends on how easy certain crudes are to refine into products. Most of the oil from tight shale crude has to be blended with heavier crude oils to make it refinery worthy. "Crude oil" such as that from Eagle Ford is actually condensate and a refinery will lose up to 30% capacity due the very light nature of it. Such a loss of capacity would bankrupt most refineries.

That being said, oil companies do invest in R&D for new technology and materials used elsewhere way the hell more effectively than Silicon Valley. Low oil prices mean that research PhD's lose their jobs. For instance single wall carbon nanotubes in compounded materials in deepwater high temp high pressure components at the wellhead were used there before being used by NASA or military. Originally Posted by LakeCityGuy

+1

Yes but you have been arguing how great LOW OIL PRICES are. Trump wants the Saudis to keep pumping to drive the price even lower. Or at least that is what the silly sob is trying to convince his followers.

Which is probably right as Trump is no oil man. Originally Posted by WTF

"Every cloud has a silver lining." Right now, the U.S. just became a net oil exporter for the first time in 75 years, and the U.S. can enjoy those perks until the next cloud floats into position.

Saudi Arabia's new fields especially offshore require %70 per barrel oil to breakeven.

Russia also needs a price above at least $50 per barrel. Russia's big issue is the thousands of miles that oil has to travel even get to ships just to go to China. Originally Posted by LakeCityGuy

The Saudi's are sitting on 266 billion barrels of oil reserves. That's not the "resource", it's reserves which can reasonably be expected to be produced from existing fields. That's also around 70 years production at current rates. So what it costs them to develop new fields isn't really relevant to the supply/demand situation. From what I've read, their capital, operating, transportation and G&A costs total around $10 per barrel. Yes, there are people out there that say the Saudis overstate reserves, their large fields are about to water out, etc. I'd take that with a grain of salt, but I may be wrong.

If the price of WTI goes to $70/barrel, it will be because the Saudi's and possibly other producers make it happen, by lowering their production. And if they do that, U.S. production from the Permian and a few of the other unconventional plays will increase enough to make the USA a very significant exporter.