U.S. Reliance on Oil Imports Is Reported Up
Domestic crude oil production continued its downward spiral in August, while the nation’s dependence on imported oil increased, the American Petroleum Institute said Wednesday.
Domestic crude production in August dropped 2.6% to an average 8.15 million barrels a day from the 8.37 million produced in August last year, the Washington-based industry organization said. A barrel is equivalent to 42 gallons.
In the first eight months of the year, the nation’s output was down 6% from the same period a year earlier, the API said in its monthly statistical report. But, it noted, when stretched to 18 months, the slide was an even more dramatic 11%.
At the same time, imports of crude oil and petroleum products rose 3.3% in August from a year earlier, to an average of 7.35 million barrels a day, the report said. In the first eight months of the year, imports were up 6.8% from the same period in 1986, to an average 4.4 million barrels daily..
Filling the Gap
Tensions in the Persian Gulf, combined with the ready availability of crude from producers in the Organization of Petroleum Exporting Countries, have helped to increase imports in the past few months, the API said.
The bulk of the August imports went toward filling the gap between declining domestic production and rising consumption, the report noted.
On the demand side, total deliveries of petroleum products last month were about equal to those of August, 1986, the API said. Slight increases were reported in deliveries of gasoline, kerosene jet fuel, home heating oil and diesel fuel.
On the other hand, there was a sharp decline of 13.7% in deliveries of residual fuel oil, according to the report.
The sharp decline in oil prices has hastened the falloff in production, according to the API. Because of lower prices, oil companies are drilling fewer new wells, capping marginal wells and deferring or canceling projects to squeeze more oil out of older fields, API said.
Production in the lower 48 states is declining because wells are running dry and drillers are being blocked for environmental reasons from exploring in the areas with the most potential--including oil fields offshore from California, Alaska and the East Coast, the API said.
Significant production from Alaska did not begin until oil started flowing through the Trans-Alaska Pipeline in June, 1977.
In other statistics, the API said the nation’s oil refineries continued to run at high levels in August, posting an average utilization rate of 86.2%.
Inventories of crude and products rose by 24 million barrels in August, or 2.3%, from the July level.
The share of unleaded gasoline in total gasoline deliveries increased to more than 77% in August, up 8 percentage points from a year earlier.
