For the first time in almost 40 years, the US has lost its top net oil importer position to China according to preliminary figures published by the US Energy Information Administration (EIA).
Although not set in stone yet, the news is considered by specialists as a “once-in-a-generation shift that will shake up the geopolitics of natural resources.”
However, the energy market has to wait for further monthly figures before the swing can be confirmed. This is partly because taxes may have distorted estimates for December’s net oil imports, reports FT.com (subscription required).
Oil analysts believe that even if January reverses the shift, the US is set to slip to the number two spot after China as the world’s top net oil importer later in 2013 or in early 2014, as the surge in domestic oil production on the back of the shale revolution reduces the need to import crude oil.
Key to the looming change is the latest oil production boom, fuelled by new technologies and techniques —particularly fracking— that have allowed the US to extract oil from sources practically unreachable before.
According to EIA numbers, oil production is at its highest level in 20 years, with a 40% increase since 2008. At the same time, the nation’s oil demand is at a 17-year low and the agency projects the country could even leap frog Saudi Arabia and Russia to become the world's largest oil producer by 2020.
The US is expected to produce 7.3 million barrels per day this year, up from 6.4 million in 2012, says the agency, which is the developed world’s most respected energy forecaster. That obviously impacts directly on the amount of crude the country is buying.
Imports totalled about 7.7 million barrels per day in the month of February, down 1.2 million barrels per day from the same time last year.
US oil demand for 2012 was 18.56 million barrels per day, down 2% from the year earlier and its lowest annual level since 1996, according to the EIA. Oil demand fell every month last year, except for May.
Currently, Americans import close to 10 million barrels of crude per day and Canadian oil accounts for 30% of that total. If the IEA is correct, analysts believe Canada needs to tap into other growing markets as soon as possible.