U.S. Petroleum Exports Rise to Meet Global Market Integration |
October 10, 2011 |
EIA Reports Pennsylvania Leads Northeast in Natural Gas Production
Total U.S. exports of finished petroleum products have increased more than 60 percent since 2007, according to the Energy Information Administration (EIA), which credits worldwide market integration for the rise. This trend is driven primarily by finished motor gasoline and distillate fuel oil, which are increasingly exported to Latin America. Annual U.S. exports of gasoline and distillate increased by 133 percent and 144 percent, respectively, from 2007 to 2010.
Both exports and imports are a normal part of global trade, but the volume of petroleum products exported from the United States is a small portion of U.S. consumption of those products. From 2000 through 2009, motor gasoline exports were generally 1 to 2 percent of motor gasoline product supplied (a proxy for demand). From 2010 to mid-2011, they have averaged close to 4 percent, reaching a high in December 2010 of 5.8 percent. Distillate exports, which include diesel fuels and fuel oils, represent a more significant share of total available product. From 2000 to 2008, distillate exports were less than 10 percent of distillate product supplied in all but two months. From the beginning of 2009 to mid-2011, distillate exports were more than 10 percent of distillate product supplied.
In petroleum product markets, Europe and Canada have been the traditional trading partners of the United States, with the volume of products shipped across the Atlantic tied in large part to the current price differences for delivery to the New York Harbor compared to Rotterdam, Amsterdam.
Over the last several years, other regions have become increasingly involved in the trade of petroleum products. Rising demand and tight supply in Latin America, together with a decline or leveling off of U.S. product demand, have led to the growth in U.S. exports to that region.
Pennsylvania Drives Northeast Natural Gas Production Growth
In the Northeast United States, natural gas production has grown rapidly since early 2009 as a result of increased drilling activity in the Marcellus Shale. The largest production gains have occurred in northeastern Pennsylvania, with noticeable increases in southwestern Pennsylvania and West Virginia.
According to Bentek Energy LLC estimates, natural gas production in West Virginia and Pennsylvania now averages almost 4 billion cu ft per day (bcf/d), more than five times as much as the average from 2004 through 2008. It accounts for more than 85 percent of total northeastern natural gas production.
Production in northeastern Pennsylvania recently passed 2 bcf/d, up from just 0.4 bcf/d at the start of 2010. In Southwestern Pennsylvania, production is more than 0.8 bcf/d, more than three times the level at the beginning of 2010.
In West Virginia, production has grown more than 40 percent since January 2010 and recently surpassed 1 bcf/d. Production in the rest of the Northeast has been roughly unchanged since 2007.
Source: U.S. Energy Information Administration