U.S. Crude Oil Exports & Gasoline Prices
The Exxon Petroleum Institute (API), the tight oil sector's other lobby groups and the mainstream oil "journalism" sector all like to remind us that more tight oil production is good for the American consumer and lowers the price of gasoline at the pump.
Let's take a gander at that for a second:
From 2008 to 2015 the U.S. tight oil phenomena added about 4.5 MM BOPD to U.S. production totals; most of that LTO was absorbed by Gulf Coast refineries and stayed in America. During that period gasoline prices were pretty high, a little south of $4 per gallon.
By late 2014 too much U.S tight oil production finally flooded a balanced world oil market and drove the price of oil down from the mid $90's to the high $30's. OPEC got the blame for that price collapse but that was a lie. It was reducing its oil production thru 2013-2014 to make room in the market for U.S. tight oil. When the price fell 3Q14, OPEC got pissed and jacked its production up, trying to regain market share.
Overwhelmed with tight oil volumes and the growth-over-profit scheme, the U.S lifted the ban on oil exports in 2015. In 2016 OPEC reduced its production to increase oil prices, again, and the U.S. went nuts, borrowed more money, again, and added rigs. During that period gasoline in the U.S dropped about a dollar per gallon and was fairly stable from 2016 to 2020, before COVID.
Then in 2021 and the Biden administration, the Permian found another gear, exports increased (we can only absorb 4.8 MM BOPD of LTO in American refineries) and gasoline went back up 70/80 cents a gallon. Tight oil production eventually rose another 5.0 MM BOPD, to 9.6 BPD, and most of that was exported to foreign countries cutting deeply into OPEC's market share. Again.
Trump got re-elected in 2024, took office in 2025, the drill baby, drill thing didn't pan out so he begged the KSA and OPEC to increase production. Gasoline inched back down 50-60 cents. Drill baby, drill had nothing to do with that.
All that big work went to hell in March of 2026.
So, I am not seeing where tight oil exports from the Permian Basin lowered the price of gasoline in our country much.
Now, U.S. exports are back up to 5.2 MM BOPD (Bloomberg, EIA). It took me $110 to fill my pickup this morning.
The oil exports to 'valuable European allies' BS never made much sense to me and sure doesn't now. Ask Spain. We're losing up, mid and downstream oil and gas jobs right and left, even with oil and LNG exports.
Remind me again why selling the last of America's oil and gas resources, below costs (including debt), is good for America's long term energy security?
