Sunday, April 14, 2013

the collapse of oil imports to the U.S. to Establish Market Crude World

(There was an earlier version of this story ran online.) If you have oil analysts say seven years ago, by 2014 the U.S. imported only 6 million barrels of crude oil per day, or nearly one-third of what the state was doing, he did not believe. Import longer considered for nearly two-thirds of U.S. oil consumption, according to the federal Energy Information Administration, and the increase for 30 years. Along with all the major areas are found and lower production, America seems destined to import more and more oil, especially from Canada, Mexico, Venezuela, Saudi Arabia, and the West Africa.Then came close to exploding hydraulic fracturing to extract oil and gas shale water and U.S. energy picture has changed dramatically in recent years. Now the International Energy Agency estimates that by 2020, U.S. oil production has surpassed Saudi Arabia. It will change decades of established trade production slate patterns.Most new U.S. light, sweet crude that can be easily refined fuel and valuable in the world. Light, sweet crude oil is more viscous than the heavy, sour crude oil, with less sulfur. But the heavy, sour crude oil tends to a few dollars per barrel cheaper than light sweet crude oil, Venezuela and Canada and have a backup of it. That is why in the year before the shale boom hit the U.S., some of the largest refiners in the U.S. spent more than $ 20 billion in upgrading their refineries so they can process it gunky fuel, asphalt, and other products.Now, refinery revise their plants to handle the heavy crude trapped . If they buy the oil, light sweet, they wasted their investment. "I think these refineries are reluctant to eat the cost of a new coker unit will be installed," said Timothy Evans, an analyst at Citigroup (C). (Coker Unit split into various oil and gas liquids.) Best way for them to get a return on investment, he said, is to process heavy, sour crude oil, well that because cost.Thus lower margin, despite the abundance of high-quality crude, the need for heavy, sour oil from other countries is high in the coming years. For reasons of Canada remains the largest supplier of America. Not just Canadian oil pipeline near and able to cross the border, but the heavy, sour crude oil pipeline is also what U.S. refiners want.Canadian operator TransCanada (TRP) is trying to get U.S. approval of its Keystone XL pipeline, which will eventually move 1.5 million barrels per day of heavy Canadian crude to refineries in the Gulf Coast sour. The pipeline will lower the cost of shipping to Canada and take their oil even more expensive than crude oil sold in the United States through Mexico (sold 1 million barrels per day in the United States), Saudi Arabia (1.2 million), and Venezuela (950 000). "Gulf Coast market is not big enough to take on a new Canadian oil imports and keep current," said Edward Morse, head of commodities research at Citigroup Global Markets. "There has to give." While the need for heavy, sour crude oil is not good news for Canada, the U.S. oil shale revolution possible result in a sharp decline in oil imports from Africa, mainly from West Africa's largest OPEC members, Nigeria and Angola. Both suppliers light, sweet crude. Since July 2010, the U.S. has cut Nigeria imports by half, from more than 1 million barrels per day to 543,000 in October 2012, according to the latest data provided by the EIA. They are imported from Angola dipped below 200,000 barrels per day, from an average of 513,000 in 2008. "In the second quarter of this year, we have to stop imports of West African light, sweet crude in the Gulf," predicts Morse. Sometime before mid-2014, he said the United States and Canada will stop the import of crude oil from West Africa altogether.Those barrels to find another home. Surplus Africa on Middle Eastern oil suppliers compete for customers in India, China, Europe, and Korea. As global competition heats, world oil prices will probably drop more. Morse said that the $ 90 would be a new ceiling for oil prices from the floor that the previous years, he anticipates the transition will fall this shift in the geopolitics of global trade "Annoying high." Disrupt Oil may be too. Angola, Nigeria, and Venezuela relies heavily on oil revenues to keep their government subsidies to survive and keep well-known that lower prices for food and fuel for their citizens. If Morse just the average world price of oil hovered below $ 90 a barrel, the pressure on states to weaker oil intense.The bottom line: Oil production in the U.S. could exceed Saudi Arabia by the year 2025. African countries may have to scramble for new markets.

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