Petroleum exports by the United States posted another record high in December. Petroleum exports from the country have renewed historical records frequently in the past several months.
Petroleum exports and domestic crude oil production in the U.S. show steady upward trends apparently in contrast with the shrinking of petroleum imports.
The petroleum demand in the U.S. has peaked out in mid-2000s. Meanwhile, increasing domestic crude oil production that is boosted by the shale revolution has reduced crude oil imports into the U.S. and made the region’s crude oil prices cheaper than international markets. Lower crude oil prices led U.S. petroleum products exports more competitive.
However, petroleum demand in the U.S. has been recovering since the second quarter of 2013. The U.S. Energy Information Administration forecasts that the country's petroleum demand could be firmer towards the end of 2015.
Keystone pipeline has started operation of its extension part towards the Gulf of Mexico, it is likely to ease the high crude oil stockpile level in the U.S. Midwest. The discount of the U.S. crude oil against the European benchmark is also expected to shrink.
Therefore, EIA does not predict that the U.S. will export petroleum at far above 2 million barrels per day level over the next 2 years. Further breaking record of export might not be seen in the near future.
In the U.S., the cancellation of crude oil export ban is being discussed aggressively. The country has prohibited export of domestic produced crude oil since 1975. But current supply and demand situation suggest that crude oil export might not begin significantly even if the U.S. government lifts the ban.
On the other hand, the resume of crude oil export may push U.S. crude oil prices up towards international prices. It could accelerate conversion of energy use to natural gas in the country.