U.S. Expected to Return to Being a Net Importer of Crude

In the April Short-Term Energy Outlook (STEO), the Energy Information Administration (EIA) forecasts that the United States will again become a net importer of crude oil and petroleum products in the third quarter of 2020 and remain a net importer in most months through the end of 2021. As U.S. crude oil production continues to decline, fewer barrels are available for export. In addition, net exports of petroleum products will be lowest in the third quarter of 2020, when U.S. refinery runs taper off in response to lower demand for refined products.

In September 2019, the U.S. exported 89,000 bbld more crude oil and petroleum products than it imported and became a net exporter of crude oil and petroleum products for the first time since monthly records began in 1973. The country continued to be a net exporter through February when net exports reached 1.79 MMbbld, and the April STEO forecasts that net exports will continue through May 2020.

As a result of recent significant changes in global oil market dynamics, EIA is revising its March STEO forecast that U.S. net exports would average 600,000 bbld in 2020 and 300,000 bbld in 2021. EIA now forecasts in the April STEO that U.S. imports and exports will be nearly equal in 2020 and that U.S. net imports will average 1.4 MMbbld in 2021.

It is noted that the April STEO is subject to increased levels of uncertainty because the global response to the 2019 novel coronavirus disease pandemic (COVID-19) is dynamic, and the impacts on energy markets continue to evolve. The response has already caused changes in energy fuel supply and demand patterns that are highlighted in the April STEO assumptions.

SOURCE: The Weekly Propane Newsletter, April 9, 2020. Subscribe for all the latest posted and spot prices from all major terminals and refineries around the U.S., including a center spread of posted prices with hundreds of postings completely updated and delivered to inboxes each week, along with market analysis, insightful commentary and much more.