Can US survive if OPEC oil imports are stopped?
OPEC suppliers shrugged off the goal of new administration of cutting the oil imports from ‘hostile’ countries. The idea of oil independence was dismissed as total nonsense. Bloomberg reports:
The U.S. is “closely integrated in the global energy market,” Saudi Arabia’s Energy and Industry Minister Khalid Al-Falih said, while his Venezuelan counterpart Nelson Martinez said he expects his country’s crude exports to the world’s top consumer to remain stable.
Just after his inauguration on Friday, Trump said he was “committed to achieving energy independence from the OPEC cartel and any nations hostile to our interests,” by exploiting “vast untapped domestic energy reserves”, according to a plan posted on the White House website. The U.S. imported about 3 million barrels a day from the organization last year, with Saudi Arabia and Venezuela accounting for 1.81 million, according to data compiled by Bloomberg. (Read the full article)
The following diagram shows distribution of oil imports between OPEC countries:
If those numbers are taken out of context, they seem impressive. But within the context of total oil consumption by US, which is approximately 20 million bpd, the import numbers do not look unreachable. The quick look at the EIA (US Energy Information Administration) brought the following numbers and graphs: US imports only 24% of the consumed petroleum products, the remaining 76% are domestically produced. (All data are for the end of 2015).
Consumption of petroleum products did not grow significantly since 2003. Domestic production almost doubled since 2007 and imports dropped by one third for the same period. The US is also exporting approximately 500,000 bpd (see here).
Petroleum imports dropped by one third since 2007, mainly due to OPEC import reduction, and currently most of the oil imports (about 4 million bpd) come from Canada.
On the paper, the possibility of completely cutting off OPEC imports to US looks realistic. It should not trouble OPEC though, since oil can always be sold to someone else.