We noted yesterday the impact on crude oil and gasoline prices of the growing U.S. production of crude oil and other liquids. A side effect of that production growth will be a cut in U.S. imports.
In its latest Short-Term Energy Outlook, the U.S. Energy Information Administration (EIA) reported that U.S. imports of crude oil fell to 7.5 million barrels a day in 2012, down from a recent peak of 12.5 million barrels a day in 2005. By 2014, the EIA expects U.S. imports to fall to an average of 6 million barrels a day.
In a similar vein, the share of U.S. consumption attributed to imported fuel has fallen from about 60% in 2005 to an average of 40% in 2012. The EIA expects imported fuel to account for just 32% of U.S. consumption by 2014.
The drop in import requirements is due to increased domestic production and reduced consumption. U.S. consumption totaled 20.5 million barrels a day in 2005 and 18.6 million barrels a day in 2012. That decline will reverse through 2014, to 18.8 million barrels a day, largely because average gasoline prices are forecast to fall from $3.63 in 2012 to $3.34 by 2014.
These numbers hardly spell energy independence for the United States, but they do indicate that the country will be spending less to import crude. And provided that there are no price shocks, this will be a good thing for the U.S. economy.
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