Yesterday, Reuters reported that crude oil exports from the United States reached their highest level since the 1920s. Using Census Bureau export data, Reuters calculates that crude shipments averaged 662,000 barrel per day in May.
The total quantity is only part of the story, however. Since the boom in U.S. crude oil production really started to take hold in 2012, exports of crude oil increased from 47,000 barrels per day in 2011 to 458,000 barrels per day in 2015. In the first five months of 2016, they’re running at a clip of about 500,000 barrels per day in 2016.
Before the lifting of the export ban beginning in 2016, exporting crude oil required special dispensation from the Department of Commerce, and virtually all exports went to one country: Canada. (Before 2001, we also exported a considerable amount to the U.S. Virgin Islands, a U.S. territory, with occasionally small forays, usually of limited duration, to other countries.)
That’s changed. Since the ban was lifted as the end of last year, the amount of U.S. crude oil going to countries other than Canada has increased substantially, from about 8% in 2015 to 41% in the first five months of 2016 (see the chart nearby).
We’ve noted here before how the lifting of the export ban would allow America to play a bigger role in world crude oil markets on the supply side, not just the demand side. These new data suggest we’re beginning to do just that.